Described herein are systems, methods, and software to manage the encapsulation of layer two communications across computing sites. In one example, a gateway at a first computing site may receive an encapsulated packet from a second gateway at a second computing site. After receiving the encapsulated packet, the gateway decapsulates the encapsulated packet and determines that the decapsulated packet satisfies MSS criteria. The gateway further, in response to determining that the decapsulated packet satisfies the MSS criteria, modifies an MSS option associated with the decapsulated packet to a maximum value and forwards the decapsulated packet to a destination virtual node in the first computing site.