I had pretty much the same problem with some Ubuntu boxes. What happened was that the /boot volume was 100% (or close to 100%) used because the system had multiple kernel versions that used up the space. The fix is to increase the size of /boot during conversion, which is easy to do. Prior to converting the box, you can check the /boot volume utilization with the df -h command (this is for Ubuntu specifically, did't try on other distros). I think the conversion has to add some files to the /boot volume toward the end, so if /boot is already 100% full or close to it, the conversion will fail. (Disclaimer: I'm by no means a Linux expert.)
As you can see below, the source system (left side) shows that its /boot volume is 100% utilized. A similar system (right side) only has its /boot volume 33% utilized. These are Ubuntu 12.04.X LTS boxes.
I increased the /boot volume size to 1 GB from 243 MB in this example.
This is the error I received in Converter before I made the change.
FAILED: An error occurred during the conversion: 'InitrdNativePatcher failed to generate initrd image: /usr/lib/vmware-converter/initrdGenUbuntu.sh failed with return code: 1, and message: * /mnt/p2v-src-root/dev has 3 files gzip: stdout: No space left on device E: mkinitramfs failure cpio 141 gzip 1 * user script returning code 1 * unmounting /mnt/p2v-src-root/dev /mnt/p2v-src-root/proc and /mnt/p2v-src-root/sys ERROR:
failed running mkinitrd /boot/initrd.img-3.2.0-58-generic 3.2.0-58-generic with chroot /mnt/p2v-src-root '