This question is well explained in the community doc Understand How Virtual Machine Traffic Routes . However it is missing the scenario of 2 VMs on 2 different hosts, but same vDS (same port group). Both hosts connected to different physical switch.
For VM1 (on Host 1 ) to reach to VM2 (on host 2), will it go out from VMNIC (physical) on host 1 out via physical switches?
Thanks in advance.