Is "v" ever an acceptable English rendering of ü?
AFAIK (I'm a native English speaker) the letter v is never used in English writing to render the sound represented in pinyin by ü.

However in software that uses pinyin it is standard practice to use the letter v as an alias for ü.

From Wikipedia (link):


  Since the letter "v" is unused in Mandarin pinyin, it is universally used as an alias for ü. For example, typing "nv" into the input method would bring up the candidate list for pinyin: nǚ.


There are indeed some cases where people mistakenly use v in Pinyin instead of ü. It does seem to be a mistake, probably induced by the IME typing convention.
This blog post gives an example in a street sign in Beijing.