I recently tried to install Windows 7 64-bit on VMWare Workstation 7.1.3 on top of Ubuntu 10.04 as a host. I found that it behaved quite unreliably once the VMWare tools were installed into the guest OS - in particular, it regularly hung on boot-up. However, once I saw this error message, which clued me into the problem:
I discovered that the solution was to disable 3D graphics acceleration - in the VM’s settings, untick Display / Accelerate 3D Graphics. The VM now works smoothly.