A. This problem is covered in the release notes for SCVMM 2008 and is related to two hotfixes Hyper-V needs because of problems with Hyper-V and the Background Intelligent Transfer Service. Here’s the message screen you see when you haven’t installed the required fixes:

To resolve this problem, download and install updates KB 956710 (this removes the need to install KB 956589, which was referenced in SCVMM 2008’s release notes) and KB 956774.

You’ll need to reboot after installing the updates. After the reboot, the Upgrade Available warning is gone and the Virtualization service’s status shows as Up-to-date.