Just dealt with this and thought I would share. ESX 3.0.1 and VC 2.0.1. Had issue where after deploying a template during during the start of the vm and sysprep is having it join the domain it started failing (really long timeout here).
After this timeout I could join the domain fine using the same user and creditials the template was using.
Turns out this is a known Symantec AV bug (ver 10.1.4.4000 in my case).
Update your client to something earlier or later.