I have around 12 Windows 7 VMs upgraded from 5.0 and 4 of them having HW 8 still. The console refresh is not visibly degraded in 5.1. However, I am not getting any of the messages that you are seeing in vmware.log of the guests.
Also, can you check on the vsphere client version to be of 5.1's and if possible try to do a RDP to one of the guests and perform a refresh on them and check is the refresh is the same.