A VMK (VM Kernel) interface is a virtual interface that ESXi itself uses to connect to the outside world. When we first setup an ESXi, VMK0 is setup to be the management interface.
When you install Nexus 1000v, the VEM modules need a way to communicate to the VSM modules, and we need a VMK interface on the ESXi hosts to do this.
If you choose to use the management VMK interface (normally VMK0) for layer 3 control, that VMK will need to be moved over to the Nexus 1000V, where it will sit ‘behind’ the VEM or else VSM will not ‘see’ the VEM (i.e. it won’t appear in the output of ‘sh mod’) until the VMK interface is moved to the VEM.
For myself I prefer to have VMK0 interface “out of band”. I leave VMK0 with vSwitch0 and create a new VMK1 interface for the VEM communication
If you choose this option, you may need to configure static routes on the ESXi host if the two VMK interfaces are in different VLANs – for example, a default gateway would be configured via VMK0, while a more specific static route would be configured via VMK1 towards the VSM IP address.