Hey Experts,
Appreciate is you can explain me a packet walk how the logical routing would be handled by the DLR if VM1 intends to communicate with VM2.
Both VMs are running in the same physical host. VM1 is connected to logical switch and is part of VLAN20 while VM2 connects to a vDS and is part of VLAN10.
Hello,
I am not a network Expert myself so I will give a article which should answer your question (DLR and local routing):
http://www.routetocloud.com/2014/06/nsx-distributed-logical-router/
Your case is a little more complicated becuse you are trying to reach VLAN from VXLAN. So, for this communication responsible i Edge gateway. In my opinion (i am not 100% sure) you DLR should route traffic to Edge and edge will send it to physical environment and it will goes back to the same host.
I hope someone confirm/reject my opinion 
@ Many Thanks for sharing such a valuable resource regarding NSX DLR.
But as you have mentioned it yourself, the case I presented is a little complicated; or may be stupid because the diagram attached with this post is my personal imagination regarding VXLAN to VLAN routing.
Awaiting for more experts to share their opinion about this scenario.
Thanks once again, much appreciated.
Hello,
I think this is an interesting scenario. (not sure why you didn't run VXLAN for all VMs on this host but must have a reason)
2 Questions..
1. What version of NSX are you running for this?
2. Where is your L2 Bridge located? On the same host or on another host? (VXLan to VLAN needs L2 bridge - assuming your DLR is not running L2 Bridge)
Thanks,
JC