I’ve had a couple of bumps when trying to P2V a physical machine which has more memory than my Virtual Server host has. This problem is only encountered when using the GUI, you can get around this if you use some powershell. Here is the command I used to do this….

 $Credential = Get-Credential
Get-VMMServer -ComputerName “vmmhost.testlab.local”
$VMHost = Get-VMHost -ComputerName “vmhost.testlab.local”
New-P2V -SourceComputerName “P2VCandidate.testlab.local” -VMHost $VMHost -Name “GuestName” -Path “e:\VMs” -MemoryMB 768 -Credential $Credential -RunAsynchronously

get-credential will prompt for a username and password, make sure it’s a domain username and password that has access to the server you are trying to P2V.

Happy P2Ving!