Fusion doesn't seem to think that the Windows 11 ARM 24H2 ISO is indeed Windows 11. It seems to think it's Windows Server, and mis-configures the virtual machine because of it.
I'm actively working on a work-around to this that looks promising. Stay tuned for a couple of hours and I think I'll have a way out of this mess.
Note that VMware has not officially announced support for Windows 11 24H2 as a guest operating system - that might be at the core of this issue (and that Windows 11 24H2 was just released a couple of days ago). The mechanism being used to download Windows 11 ARM is forcing 24H2 on us, and not allowing us to go back to 23H2 which would download and be recognized properly as Windows 11.
That being said, I think we will be able to make it work.