Based on your statements:
With the current config if I lost the mgmt port which is on pswitch1 than the standby would kick in (which is on pswitch2) and in that sense my host1 would remain reachable. So Id have to pull both the mgmt active and the standby cables to get HA to fail and prove my concept, Correct? so.....if that's the case our vm's can function if one switch should fail.