ZFS definitely is definitely pretty awful (At least in my experience so far) for hosting VMs.  I believe this is due to the synchronous writes being performed.  However, I think running an iSCSI target with Synchronization disabled over a 10Gb connection might do the trick. (I have a couple of mirroed SSD drives for performance if I need it, but the RaidZ2 crawls for disk speed).

When I tried to migrate a thin provisioned guest to iSCSI, I keep getting an "Out of disk space error" which I am pretty sure is due to the block style storage on the iSCSI target.  Is there a way to switch from Thin to Preallocated?  Or is my best bet to try and take a snapshot and clone this into a pre-allocated disk?