For a persistent MED-V workspace, you have the option of configuring a MED-V VM setup script to run at the initial workspace launch. This is referred to as FTS (First Time Setup.)

One of the script functions available is the option to join a domain. Among the parameters available to use when joining the domain is the placement of the guest computer into a specific OU (organizational unit specified by distinguished name.)

With version 1.0 of MED-V the tool that processes this action and joins the domain inside the workspace, the domain tool (DOMAINTOOL.EXE), only supports the use of root-level OUs.

That means that the use nested OU's will cause the setup script function to fail (domain join) and that can cause the setup to completely fail and the workspace to not start. As a result, the image will need to be redownloaded (or reimported if using pre-staged images) once the policy is corrected. 

Thanks to Steve Thomas for originally documenting this.