When you attempt to create or clone a virtual machine on a datastore cluster, you might receive the error message, Operation Not Allowed in the Current State.

Storage DRS checks for rule violations when you create a virtual machine on a Storage DRS-enabled datastore. If Storage DRS cannot create the new virtual machine's disks in compliance with the rules, it generates a fault. The fault is generated because Storage DRS cannot reference the virtual machine, which is in the process of being created and does not yet exist.

Revise or remove the rules and retry the create or clone virtual machine operation.