This article discusses a possible failure at step 4.1.1 of a conversion to a Microsoft Virtual Server
When attempting to convert a source server to a Microsoft Virtual Server, the conversion job fails at step 4.1.1 with the following error:
CreateVM action failed:Can't connect VHD, there are no available resources...
This error is due to an already existing VHD file with the same name on the Microsoft Virtual Server. By default, Microsoft Virtual Server will create the new target VM in the C:\MSVS\<hostname of target VM> directory. Check to see if a corresponding .VHD file already exists in this directory.
This cause of this error is most likely due to a previous failed or aborted job that was not properly cleaned up. Please see TID 7920041 for details on "How to clean up an aborted job?"