After starting this process on a test VM, after 3 hours of converting it failed.  The logs gave me the following:

UNKNOWN_METHOD_FAULT(vim.fault.NotAuthenticated)

I stumbled upon a post on the vmware communities that suggested I try the following

When setting up the conversion, don’t use “convert all disks and leave current size”, use “select volumes…” and leave all volumes selected and the default options checked.

I gave it another try and voila! Conversion worked without error.

I wonder if multiple disks has anything to do with the snapshot merging problems I’ve had so many times.  As I attempt to remember specifics of all past failed attempts, I believe they’ve all had multiple disks.  Maybe that was the problem all along?  As long as this Plan B works I’m happy!

When I first attempted to Scan for Updates I received the following error in VI:

metadata for patch missing

Searching through the forums suggested the ESX host FW wasn’t properly listening for connections and suggested I run:

esxcfg-firewall --openport 80,tcp,out,dynamicupdates
(port 80 was specific to my environment and may vary for your setup)

Once I did this the Scan for Updates ran just fine

Onto the upgrade….

Before the upgrade

[root@esx-03 root]# vimsh -n -e 'hostsvc/hostsummary' | grep fullName
File not found.
fullName = "VMware ESX Server 3.5.0 build-82663",

1.Reinstalled Update Manager and attached the Critical and Non-critical Baselines to the ESX hosts

2.Put my first ESX host into Maintenance Mode and agreed to all the informational messages that come with that

3.Selected all Guest VMs and migrated them to another ESX host (I’m still not absolutely sure if entering Maintenance Mode actually evacuates all the running VMs.  I just migrate them manually because I can see it working)

4.Right clicked on the ESX host and chose Remediate, chose both Baselines and Next’ed through the wizard.

5.30 minutes later the ESX host was back up and running with the newest patches and updates. Repeat steps on all other Hosts.

After the upgrade

[root@esx-03 root]# vimsh -n -e 'hostsvc/hostsummary' | grep fullName
File not found.
fullName = "VMware ESX Server 3.5.0 build-123630",

One thing I noticed after the upgrade was that the SSH server didn’t automatically start even though it was set to

I clicked START and all was well.  I will do more troubleshooting on this the next time I need to reboot the Hosts.  I’d rather not evacuate all my Guest VMs for this reason alone. For now I’m happy being up to date.