If you assign static IP 169.254.1.1 to any vmk from subnet 169.254.x.x, the GI deployment would be failed as it uses 169.254.x.x subnet to assign IPs internally for GI service. It fails with blank box error for any host which have vmk with static address 169.254.1.1 as the IP is already taken and vmk with it for GI management cannot be created. The USVM for the affected host will not be configured properly and deployment would fail.