Its actually from a physical machine with a 500GB HDD (complete overkill for what was required) to a vm host with about 30GB space (10GB is only used).
I had planned to install a fresh os on the vm host and move the data across, I was testing with my own vmware player installation (fresh install and moved most folders across) but that is were I was running in to problems. I believe the /etc folder is the one that is causing me issues as I read up that it holds config files for most applications which is why I was copying it across but it seems it holds filesystem settings also.
My problem is that I don't know enough about the project or what was involved (particulary what applications / settings etc were implemented on this linux machine) so I don't know what exactly I am looking for in regards applications, databases and settings, all I do know is that mysql and php were installed, I am sure there are more.
The only thing that is changing is obviously the hardware (but I am not restoring the /dev folder so that shouldn't be a problem) so I think its an issue with the filesystem / partition table. I am not sure what I should be leaving out on the restore.