A very nice article explaining how to migrate from an external Platform Service Controller to an embedded one:
A note about versioning: use the same version of the converge tool as the version of your vCenter and PSC. Otherwise the converge will most likely fail (as it did when using 6.7 tool on a 6.5 environment).
In the event of migrating your old vCenter Server to a new version (or from Windows to the appliance), it may become necessary to first clear out old historical data. Not only will this speed up the migration process considerably, it will also prevent certain issues which may block the migration from completing successfully.
VMWare provided a KB with database scripts which allow you to selectively purge historical data and decreasing the database size: KB 2110031.