Virtual machine swap file location affects vMotion compatibility in different ways depending on the version of ESXi running on the virtual machine's host.
You can configure ESX 3.5 or ESXi 3.5 or later hosts to store virtual machine swap files with the virtual machine configuration file, or on a local swap file datastore specified for that host.
The location of the virtual machine swap file affects vMotion compatibility as follows:
For migrations between hosts running ESX/ESXi version 3.5 and later, vMotion and migrations of suspended and powered-off virtual machines are allowed.
During a migration with vMotion, if the swapfile location specified on the destination host differs from the swapfile location specified on the source host, the swap file is copied to the new location. This activity can result in slower migrations with vMotion. If the destination host cannot access the specified swap file location, it stores the swap file with the virtual machine configuration file.
See the vSphere Resource Management documentation for information about configuring swap file policies.