However if a host fails - what is the effect of this? - would the VMs move? - would I need to
follow a prompt to move - so if it was middle of night they (VMS) would not be available?
No, they would not move. If you do not have VMware HA configured, the VMs would be unavailable, and off, because the hosting server has failed. DRS only moves VMs using vMotion based on selection and loading on the Hosts.
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VMware HA if correctly configured, will restart VMs on another host should the hosting host fail.
VMware Distributed Resource Scheduler (DRS) Product Briefs
VMware High Availability (HA) Product Briefs