Same problems. I'm getting "authenticate now" messages but can't access anything in the system that would provide that service. Control panel is blank, trying to get properties on "Computer" (vista sp1) does nothing. Running Windows Update, nothing happens. No window opens, no notification of failure ... just nothing.
On the bright side, everything works just fine when operating outside the "system envelope". Every program I've tried so far has worked just fine, I can interact with the Mac disks and move data between vista and os x.
Course, in a few days Vista will become convinced I'm a thief, and degrade my "experience" I guess.
On another bright side, this is a Boot Camp installation (dedicated hard drive) and thus far I've had no problems at all booting directly into windows. It says it's activated and everything is working just fine there. Problem is, I have a very integrated experience going on my computer. Lots of data resides on OS X disks, very little is on the separate Vista HD. So, it is just about impossible to work from an exclusive windows boot. I need all that data hiding on the OS X disks.
Well, I'm sure this will resolve in a while and naturally the sooner the better. But I've been a happy camper with parallels for 18 months so I can wait for a bit to see this ironed out.
BTW, after install the system had disabled UAC in vista. I turned that back on as I find it somewhat annoying but reassuring to have a watchdog checking and asking for permission for system changes and updates. Maybe this is a problem with Parallels 4. But, somehow I doubt it.
Rick