VMware restore fails with “The operation is not supported on the object” (4046739)

From binary log:

Error 2012/05/08 10:39:24 92 Data Plugin BACKUP Failed to add VM to target server's inventory

Binary log sub text

VMWVIM :01124 116 0 65727 Fault string is 'The operation is not supported on the object.'

VMWVIM :01124 117 0 65727 Fault type is 3227

VMWVIM :01124 605 0 65727 Failed wait for CreateVM_Task

VMWVIM :01124 617 0 65727 Failed to create VM from config info

VMWRESTR:01124 105 0 65727 Failed to add VM to server inventory

Restore VM using the restore to files option edit the VMX file and the video card setting are as below:

svga.autodetect = "true"

svga.vramSize = "16777216"