The basic difference is that when you clone a virtual machine, you're clone the virtual machine files (.vmx and .vmdk) and when you're doing a V2V, you're copying the files inside the guest OS to another VM, and this may not works 100%, will be more slow than a clone and will require some additional steps after the conversion.
If you want a copy of a VM with 100% of your data with very little administrative efforts and fast, I will recommend a clone.
A V2V will be recommended when normally you're converting a VM from on format/solution to another, for example: convert a Hyper-V virtual machine to vSphere virtual machine.
This another thread can gives you another definitions: Re: What is the difference between cloning a vm and v2v conversion of a vm
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Richardson Porto
Senior Infrastructure Specialist
LinkedIn: http://linkedin.com/in/richardsonporto
