Comment 1 for bug 892765

The timeout for waiting on coalesce is too low. I'd try raising the value of this flag:

FLAGS.xenapi_vhd_coalesce_max_attempts

You might need to raise it substantially. coalesce could take an hour, maybe. And max attempts works with this flag:

FLAGS.xenapi_vhd_coalesce_poll_interval

We will check for it to be done <max_attempts> times... checking every <poll_interval> seconds. Default of 5 for poll_interval, means you may want to have max_attempts set to 720 to make it one hour total.

Try that and see what happens? If that fixes your problem, we can raise the default values in nova.