I have exactly the same problem. But the host is Archlinux (kernel: 4.1.13) and the guest is Windows 7 and Windows XP guest.
I just switched from Ubuntu 14.04 to to Arch, copied the vm guests, reinstalled 12.0.1 under Arch and now I get the same error message. I was not getting it under Ubuntu 14.04 and Wks: 12.0.1. The reinstall dies during the installation when it asks for the password. I have tried both the sudo user password and the root password, nothing. It's expecting something but what?
Doing the full uninstall and full reinstall didn't work either.
I realize that Arch is not supported by VMw. Still, any help would be appreciated.
Thanks
/Syv