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I have been fighting with this same error for quite a while and maybe one of you can shed some light on it.  I am running V7R3 (my machine is capped at that release).
I have 2 partitions MIDOHIO and MIDOHIO2.  MIDOHIO2 is a virtual partition.  I do not have an HMC.  Since I rarely use MIDOHIO2 (most of the time it is not even powered up) I have just been ignoring the problem.
Below are the two partition configs.  I configured both partitions to be min / max of 1 processor.  So why am I getting an error that I my usage limit was exceeded?  IBM's response when I opened a ticket was "Use the Field Core Override (FCO) function in Advanced System Management (ASM) on the service processor to turn off all but the one processor you have a license for."  Is this just a bug in virtual partitions that allows it to use more than the max processors?  
Partition identifier and name  . . . . . . . :  1    MIDOHIO   
                                                               
Number of partition processors . . . . . . . :  1              
Minimum / maximum number of processors . . . :  1   / 1        
Use shared processor pool  . . . . . . . . . :  Yes            
  Shared processor pool units  . . . . . . . :    0.50         
  Minimum / maximum processor pool units . . :    0.10 /   0.90
  Uncapped processing  . . . . . . . . . . . :  Yes            
    Uncapped processing weight . . . . . . . :  Med            
Size of partition memory (MB)  . . . . . . . :  3744           
Minimum / maximum size of memory (MB)  . . . :  1024     / 8192
Enable workload management . . . . . . . . . :  No             
Partition identifier and name  . . . . . . . :  2    MIDOHIO2  
                                                               
Number of partition processors . . . . . . . :  1              
Minimum / maximum number of processors . . . :  1   / 1        
Use shared processor pool  . . . . . . . . . :  Yes            
  Shared processor pool units  . . . . . . . :    0.50         
  Minimum / maximum processor pool units . . :    0.10 /   0.90
  Uncapped processing  . . . . . . . . . . . :  Yes            
    Uncapped processing weight . . . . . . . :  Med            
Size of partition memory (MB)  . . . . . . . :  2944           
Minimum / maximum size of memory (MB)  . . . :  1024     / 8096
Enable workload management . . . . . . . . . :  No             
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