I’ve recently had some trouble with VMWare server hanging when trying to install a new OS. The virtual machine starts to boot, but hangs before loading the CD image to boot from.
The solution, so I have found, is to remove the Floppy Drive device from the virtual machine.
To do so; load the VMWare Server Console and select your Virtual Machine, making sure that it is not started.
Then select “Edit virtual machine settings”.
Select “Floppy” in the device list and then click remove.
Then click “Ok”, and power on your virtual machine.
Your virtual machine should now power on normally and not hang!