Virtual machines are usually stored as .pvm files in ~/Documents/Parallels. .hdd files are usually stored inside the .pvm files. So you can create a new virtual machine, Continue without disc, select the OS on the .hdd, Like a PC, Customize settings before installation, Create. go to Hardware in the new virtual machine configuration, Hard Disk 1, select [-] to remove the hard disk, Move to Trash, then [+] to create a new Hard Disk, Type: Existing image file, Location: Choose a file, navigate to inside the old .pvm, select the old .pvm's .hdd file, Choose. Now you can start the new VM. Does it have the same error?
If the error doesn't exist for the new .pvm, then move the old .pvm's .hdd file out of the old .pvm, then remove the old .pvm from Parallels Desktop Virtual Machine List window (right click) and use the "move to the trash" option. Make sure the old .pvm's .hdd file didn't also move to the trash, and reselect the .hdd in the new .pvm's Hard Disk 1 settings.