The SAN latency graphs in 3.5 seems to be a bit odd and I suspect that there's a bug somewhere (haven't narrowed down the source yet). The graphs seems to be much better in 3.0.x.
To disable DriverAvgMsec from being shown, edit /etc/vmktree.conf and change the line:
esxhost.item.d.graphonly:=DriverAvgMsec KernelAvgMsec GuestAvgMsec
into:
esxhost.item.d.graphonly:=KernelAvgMsec GuestAvgMsec
Lars