This article discusses why the vSAN on-disk format failed, detailing the vSAN On-Disk format version check/upgrade in the vSAN Health Service and explaining the potential reasons for reporting an error.
The vSAN on-disk format upgrade will fail if the vCenter version is lower than the ESXi version.
In the following example, we can see the vCenter build version is lower than ESXi version. When vSAN on-disk format is performed in such configuration it will fail.
vCenter Version: vCenter Server 8.0 Update 2 Build 22385739
ESXi Version: ESXi 8.0 Update 3 Build 24022510
Upgrade the vCenter server to a build equal to or higher than the ESXi version.