But running a depmod when not needed, and doing it incorrectly could cause the problem.
Yes, that is correct. By skipping depmod the iso does boot up.
The root cause was the depmod that was done incorrectly in my script when things didn't work.
I had depmod in place so that things would continue to work if I added stuff to the core.
Thanks to all of you - I might not have narrowed it down to depmod at all.
Since the the VM booted up and there were no error messages I was stumped.