UPDATED/EDITED
We are now in support with VMWare, it appears this may be a bug which is being investigated.
I had thought I resolved the issue due to an incorrect/corrupt GPo, but that was incorrect.
Basically it seems that although Persona Manager is able to read the ProfilePath attribute from an active directory user object, it does not correctly expand the environmental variable "%username%" if it is part of that attribute. It instead takes it as a literal string and therefore cannot find the path.
I've kept this post open in case anyone else has the same issue.. but by all accounts it appears we are the first to use this method!