I have a virtual machine containing Windows XP SP3.

When I resized the VHD file (and the embedded partition), and tried booting, I got:

A disk read error occurred
Press Ctrl + Alt + Del to restart

Some notes:

• FixBoot and FixMBR don't help.

• ChkDsk doesn't help.

• The partition is indeed active.

• The partition starts at sector 63 (it also did so before the problem) of cylinder 1, head 1, and is marked as type 0x07 (NTFS)

• My host OS reads the VHD and the partition completely fine

• I'm interested in knowing the cause rather than the fix. So "re-format the disk", "reinstall Windows", etc. aren't valid solutions.

  It's a virtual machine after all... I have nothing to lose, so I don't care about fixing it.
  I just want to know what's causing this problem, in case I run into it again on a physical machine (which I have done before).

More info:

The layout of the original, dynamic VHD (which works correctly):

+-----------------------------------------------------------------------------+
¦ Disk: 3                         MBR/GPT:         MBR                        ¦
¦   Size:        127.00GB         CHS:             16578 255 63               ¦
¦   Sectors:     266338304        Disk Signature:  0xEE3EEE3E                 ¦
¦   Partitions:  1                Partition Order: 1                          ¦
¦   Media Type:  Fixed            Interface:       SCSI                       ¦
¦   Description: Msft Virtual Disk                                            ¦
+-----------------------------------------------------------------------------¦
¦Pos Idx Type/Name Size Boot Hide  Start Sector  Total Sectors  DL Vol Label  ¦
+--- --- --------- ---- ---- ---- -------------- -------------- -- -----------¦
¦ 1   1  07-NTFS   1.5G  Yes  No              63      3,148,677 F: <None>     ¦
+-----------------------------------------------------------------------------+

The layout of the resized, fixed-size VHD (which doesn't work):

+-----------------------------------------------------------------------------+
¦ Disk: 3                         MBR/GPT:         MBR                        ¦
¦   Size:        1.50GB           CHS:             196 255 63                 ¦
¦   Sectors:     3149824          Disk Signature:  0xEE3EEE3E                 ¦
¦   Partitions:  1                Partition Order: 1                          ¦
¦   Media Type:  Fixed            Interface:       SCSI                       ¦
¦   Description: Msft Virtual Disk                                            ¦
+-----------------------------------------------------------------------------¦
¦Pos Idx Type/Name Size Boot Hide  Start Sector  Total Sectors  DL Vol Label  ¦
+--- --- --------- ---- ---- ---- -------------- -------------- -- -----------¦
¦ 1   1  07-NTFS   1.5G  Yes  No              63      3,148,677 F: <None>     ¦
+-----------------------------------------------------------------------------+