Steve, what was the reason of excluding this disk previously? Was it because of a requirement to back this VM up using application-aware processing? The fact is that in v6.5 VMs with dynamic disks were always backed up in crash-consistent mode, regardless of the AAIP settings and exclusions (as if the VM guest OS has dynamic disks, the VM can be backed up using saved state only).
In v7 the logic has changed slightly, the job will fail in case of inability to quiesce it using VSS unless 'Ignore application processing failures' option is selected in Advanced options for Guest processing settings. Probably that is what you're observing.