Yes, that's true. If you're in trunk mode and you're passing multiple VLANs, you normally tag those on the port group side, which then strips the 802.1Q tag off the packets before they're forwarded. If you're in access mode you do not set a VLAN ID on the port group (by setting it to 0). According to your switch port config, if in access mode it should work, but if it isn't, try tagging the vmkernel port group to see if it passes the traffic. If so, it may need to be removed as the native VLAN.