Thanks dib and lamw for the information.
So, what they are saying is that because VMWare won't be supporting the CPUs in a future release, we will break the current release as well!
We have Physical ESXi hosts with a "currently" supported CPU which apparently can no longer be updated without making changes that require a reboot, before we can update them to the latest patch release. No nested ESXi here.
I will test it later this week to see if the workaround of appending allowLegacyCPU=true to the kernelopt line in the /bootbank/boot.cfg works for us.