cannot create new VM in existing cloud service

I have one Server 2012 VM running in a cloud service. I'm trying to create an additional Ubuntu VM for that same service, which always fails with the error "The server encountered an internal error. Please retry the request. The long running operation tracking ID was: ...". The details of the operation log show the AddRole command seems to fail, here's an extract of the details:

<SubscriptionOperation xmlns="http://schemas.microsoft.com/windowsazure" xmlns:i="http://www.w3.org/2001/XMLSchema-instance">
    <OperationId>...</OperationId>
    <OperationObjectId...</OperationObjectId>
    <OperationName>AddRole</OperationName>
....
    <OperationStatus>
        <ID>494a1670-3ca5-84cb-a094-a7b25e4468f2</ID>
        <Status>Failed</Status>
        <HttpStatusCode>500</HttpStatusCode>
        <Error>
            <Code>InternalError</Code>
            <Message>The server encountered an internal error. Please retry the request.</Message>
        </Error>
    </OperationStatus>
    <OperationStartedTime>2014-04-03T12:13:20Z</OperationStartedTime>
    <OperationCompletedTime>2014-04-03T12:13:40Z</OperationCompletedTime>
</SubscriptionOperation>

Any idea what might be causing this?

Suppose I create a new VM and create a new cloudservice for it, would it be possible to afterwards assign it to another cloud service?