As the title suggest, I've upgraded a number of i686/x86_64 fully updated VMs from F16 to F17. After hitting a number of snags that required manual intervention [1] I got pre-upgrade running on all machines. Once pre-upgrade was complete F17 attempted to boot but blowup on startup (i686) or shutdown (x86_64) Looking closing it seems that kernel-PAE-3.3.7-1.fc16.i686 was used by anaconda (?) while kernel-PAE-3.3.7-1.fc17.i686 was completely ignored. Booting into init 1 and removing the offending fc16 kernels (coupled with manual grub2-mkconfig) solved the problem. - Gilboa
(more-or-less solves the problem, I'm getting "file-not-found" errors from grub without additional information [which file], however, in the end F17 on all VM's boots and shuts down just fine)
*** This bug has been marked as a duplicate of bug 820351 ***