9 times out of 10 when people upgrade from ESX 3.0x to ESX 3.5 they do an in place upgrade and leave it at that.
Step 1 - upgrade VC
Step 2- Upgrade host 1
Step 3 - Upgrade next host
Step 4 - Rinse and Repeat

 Seems pretty straight forward right, well not exactly because you should really be considering a cold migration between your old LUNS and a new LUN created under ESX 3.5 at upgrade time for your virtual machines. This is because the VMFS file system was upgraded in the 3.5 release, and the upgrade actually made some changes to the way VMFS handles SCSI locking.

This was stolen from the VMTN forums, but rather than re-invent the wheel :

• ESX Server 3.0.2 used VMFS 3.21 and ESX Server 3.5 uses VMFS 3.31.

• The differences between VMFS 3.21 and VMFS 3.31 are mainly internal architecture, bug fixes, and small block size support (as low as 128K).

• Upgrading from VMFS 3.21 to VMFS 3.31 is not possible without reformating the volume. However, you do not need to move the VMFS volume to 3.31 to run ESX Server 3.5.

• The volumes are compatible. In other words, you can not upgrade a VMFS volume from version 3.21 to 3.31, but you can still upgrade the ESX Server to ESX Server 3.5 and continue to run on a VMFS 3.21. This means you can also run VMs from ESX Server 3.0.2 directly on VMFS 3.31.

 VMFS 3.31 in 3.5 introduced a distributed locking optimization - optimistic locking.

•     Basically, the actual acquisition of on-disk locks (involving SCSI reservations) is postponed as late as possible in the life cycle of VMFS metadata transactions.
  

• Doing so allows the number and duration of SCSI reservations to be reduced, thereby reducing their impact on VM I/O and VMFS metadata I/O originating from other hosts that share the volume.

• You may see the message - Optimistic Lock Acquired By Another Host - it means that a lock which was held optimistically (not yet acquired on-disk) during a transaction was found to have been acquired on-disk by a different host. In this case, we simply abort and retry the transaction.

 Source = http://communities.vmware.com/message/963043;jsessionid=7AC7B31D4BF678B3E0653EBF1C8667F2#963043

More on the Diane Green coverage @ virtualisation.info - and let me say WOW.

Some internal emails have been released and virtualisation.info has some exclusive content from an insider.

<quote> No exact details have been given, but it seems like the general idea is that she was fighting to get the company spun off fully. </quote>

Read @ http://www.virtualization.info/2008/07/exclusive-vmware-employees-reveals.html

So in case you havent heard the BIG BIG news, Dianne Greene - President and CEO of VMware was let go today. I am sure you have all seen it on the wire, and read the news.... Well without getting too far into it as I am sure others have already done, I did come across an article on theregister that has an interesting take on the situation.... The full text of the article is posted under the read more link as well as some comments of my own.

OH AND DONT FORGET EARLY BIRD ENDS TOMMOROW FOR VMWORLD!

VMware is running a national Virtualisation Seminar Series across Australia and New Zealand. Should be an excellent event so make sure you attend.

Details :

Register now to attend the free half–day seminar in the closest city near you and learn the latest virtualization technology transforming IT from the datacentre to the desktop.

Don't miss the opportunity to hear and network with industry leaders and peers in an environment that will enable you to create, deliver and maintain flexible IT environments and respond to changing business conditions.

Make this your must–see event in 2008 and register today. Don't forget to visit the TAS exhibition and take advantage of the solution tracks on offer to help you acquire the information and resources you need to move forward with your virtualization strategy.

Dates :

Australia

Adelaide
Wednesday 9 July

Brisbane
Tuesday 15 July

Canberra
Wednesday 16 July

Melbourne
Thursday 17 July

Perth
Tuesday 5 August

New Zealand

Auckland
Tuesday 22 July

Wellington
Thursday 24 July