We ran into a problem with Update Manager on vSphere 5.1 lately:

Cannot create a ramdisk of size 329MB to store
the upgrade image. Check if the host has
sufficient memory.

The help provided in vSphere documentation says

The ESXi host disk must have enough free space to store the contents of the installer DVD.The corresponding error code is SPACE_AVAIL_ISO.

Yeah, thanks 😀 That what the error message said in the first place 😀 But it might as well describe your exact problem, so please check http://virtualdiscussion.wordpress.com/2012/12/13/uprade-of-esxi-host-fails-using-update-manager-fails-vum/ for a possible resolution.

Well, didn’t do it for us. We had enough space … Hmmm … after a while of struggling, it turned out to be lock down mode which caused the error! After disabling it (via DCUI, as vCenter failed with a different error message) VUM remediated the host like a charm 🙂 WTF!?

So far, it didnt reproduce on any other host but let’s see what happens in the future 😉