I have seen this issue many times. If vCenter VM management works fine but there is a problem launching the Virtual Machine Console and the error says: “Unable to connect to the MKS: Host address lookup for server servername failed: No such host is known” check the DNS resolution at the workstation running vCenter client. It should be able to resolve the host running the VM.
This happens because vCenter Server DNS resolution is used for the VM management actions, however for the Console the vCenter Client workstation is responsible for the DNS resolution.
vCenter Client tries to resolve the name of the ESX host that was registered in vCenter server. If you do not want to advertise DNS names of of server use hosts file.
Perhaps VMware should implement host resolution via IP as secondary option if name resolution fails.