I encountered this same issue on a VM I converted and it was fixed via a chkdsk.
VM was a Windows 2008 R2 x64 that was converted from a Hyper-V environment.
Received same error as OP
I checked all the KB articles and had no success. Temp directories existed, no calls in the registry to another drive letter, common files directories were OK and a few other things I read left me empty handed.
The fix for me was to attach the disk to another VM and run a chkdsk against it. Chkdsk found a bunch of errors and corrected them. This was the only way I could get a chkdsk to run successfully, otherwise it errored out even if I tried it at startup. Afterwards I powered on the VM and VMware tools installed with no issue.
This is the only event I found that others haven't mentioned, not sure if it is the correct identifier or not but it took place at the time of my final synchronization. 