On my XP VM, which was running perfectly prior to the upgrade, the initial upgrade of Parallels Tools crashed Parallels. After a reboot, I uninstalled Tools, and installed again. This time I got a kernel panic. After running Disk Warrior to ensure the hard drive was consistent, I tried reinstalling Tools on top of the existing install. The installer crashed Parallels again. When I access Tools after a crashed install, the Parallels Network Adapter is disabled and cannot be enabled. Trying to enable it results in a "Error installing network driver" dialog. The Parallels Network Adapter in version 2.x worked fine on this machine. Also, clipboard sync is disabled every time I open Tools. It will enable, but will not stick. Anyone else seeing this stuff? I'm leery of turning on any new features when the most basic ones don't work after the upgrade.