After connecting an ESX 3.x host to a vCenter 4.0 server we have observed that VMs that was created on ESX 2.x  has their disk info corrupted and many of the VMs may show up with an unknown disk disk size (0 MB):

When a VM has disks in this state it cannot be converted with VMware Converter or be started again if it's powered off.

If you remove the disk from the VM and try to add it again you'll get the error message "Adding existing IDE disk is not supported at the moment. IDE disks cannot be hot added or there are no free available IDE Controller slots.".

 Solution

1. Unregister this VM from Virtual Center
2. Remove all scsi0:* lines from the VMs config file using a text editor.
3. Open the disk desciptor file in a text editor and replace "legacyESX" with "lsilogic". The descriptor file is the few hundred byte vmdk file.
4. Repeat this step for all the virtual disk files for this VM    .
5. Register the VM again
6. Add disk(s) to the VM

If you do not edit the descriptor file and add the disk to a vSphere VM (with virtual hw v7) it will come up as a working IDE disk.

Another workaround is to use Converter standalone inside the source VM while the VM is powered on and select to move the local machine to the new ESX environment.