You can try using Converter 5.5.1. There was a problem with SSH keys when the SSH server was configured to use DSA keys - Converter 5.5 was working correctly only with RSA keys. You can look at Re: converter error "Host <ip> key can't be retrieved.for more information. Or you can reconfigure your SSH server to use RSA keys.
Another possible reason is the network connectivity - you should be able to connect to the source server *both* from the Converter Server machine *and* from the destination VM. If the destination machine cannot connect to the source because of some networking issues (e. g. hosts.allow/deny, firewalls) then this message is displayed (not very intuitive, I admit).