Offically VMware don't support MSCS on iSCSI SAN but you can use it.
- 2 VM's running on the same ESXI 5.0 host.
> Since your running both VM's on same host its CIB config (Cluster in Box), where you can't use RDM as shared disk which is not supported.
You need to use Virtual disk as shared disk and keep SCSI Controller Bus Sharing as Virtual.
Please follow steps mentioned in MSCS guide page 10 under "Cluster Virtual Machines on One Physical Host".