Actually, a "u" with dakuten equals "v". It's an artificial construction, and one many Japanese speakers can't pronounce well, but the usage of "va" rather than "ba" means that yes, it was a V that was intended.

Also, the name was derived from the Hindu word "Ishvara"; your observation is an interesting one, too, though. (And since it's hard to convey emotion over the interwebs without the help of icons, I meant that seriously and not snidely.)