Locked out of keyboard input during any menu or alert actions on 11.1.0

I am running a W7 VM with Parallels 11.1.0 on top of a Mac with El Capitan. I have been running normally for several years and many upgrades until this most recent upgrade to 11.1.0. Now if I am in W7 VM and attempting keyboard entry into anything (this posting, or a Word doc, or an email in Outlook), if Parallels should be attempting to alert me, (the small window that pops into the upper left corner every time an email is received in Outlook), my keyboard input is cached but not displayed until that alert goes away and then whatever keystrokes have been saved up pops out. You can more readily duplicate the problem by typing into anything and move the mouse to the top of the screen causing the Parallels drop down to appear and the same effect is seen. When you have a hopping icon show up at the bottom of screen it is really hard to get control. On another VM I have that had not yet been started, I started it up and while the new 11.1.0 toolkit was loading I confimed it did not have the problem, and after the VM was restarted to 11.1.0 it is doing this same bad behavior. This must be some kind of configuration issue. Any ideas?