I have put up a merge proposal at 
 https://code.launchpad.net/~smoser/cloud-init/+git/cloud-init/+merge/311205

The plan there seems sane, we will now wait in the Azure datasource for
the azure disk resource to appear. Paul told me that all azure instances
will have an ephemeral disk, so waiting for it to appear is fine.

I have seen a race condition where 'mount -a' fails, we're debugging
that.

I like the overall logic much better, and we probably at least partially
fix bug 1642383 by waiting.

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https://bugs.launchpad.net/bugs/1611074

Title:
  Reformatting of ephemeral drive fails on resize of Azure VM

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