That should work just fine. Map the LUN to vmware with the same LUN ID and this way you'll have vmotion and HA.
You'll need some downtime to migrate the current OS or create a new VM. You should dismount the LUN from the physical server before mounting it to the ESX server to be used as a RDM
There are two types of RDMs, one virtual (which allows you to take vmware snaphshots) and physical (used for MSCS clusters) and is strictly for SAN control and SAN snapshots, etc..
If you're looking for a new SAN take a look at the Netapp, it will do deduplication and can act as your file server on the domain.