This issue occurs when an ISO/DVD is inadvertently mounted or left behind from a vmotioned snapshot.
Resolution
Verify that there are no files on this datastore that references this virtual machine:
Right-click the datastore, browse Datastore and check if there are any files for that virtual machine.
Right-click the VM, click Edit Settings, check if any hard disk is residing on that datastore.
After verifying:
Right-click the VM, click Edit Settings > CD/DVD Drive. If the Datastore ISO is checked, verify if the path is on the stale entry datastore. If yes, then uncheck that option and click OK.
Right-click VM, click Snapshot > Snapshot Manager. If there are any snapshots, consolidate (Delete all) those snapshots. When a VM with snapshots is storage vMotioned there are chances of the old datastore entry being left behind. Upon consolidation of these snapshots the stale entry is removed.