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In my case, packstack allocated very minimal storage to the hypervisor. I verified that extra storage was added and linked to a directory in the /home/ directory, but then couldn't spin up instances (even after deleting the old ones). I had file read permission errors, but the files were also non-existent. I finally found that it was because of selinux. Disabling selinux (which was acceptable in my lab) allowed me to use my instance. Posting this here in case someone has this issue.

Related reading: Disabling selinux: