hammer1,
Looks like for some reason Windows doesn't like the video adapter driver actually installed in your VM.
A workaround for the issue is rather complicated, but should help:
1. You need to mount your VM's HDD using Parallels Explorer (found in Applications->Parallels).
2. Browse to your Windows Disk C: root.
3. Right-click the "boot.ini" file.
4. Select "Open With..." -> "Other".
5. In the Window opened, find Text Edit.
6. Edit the boot.ini: append "/basevideo" to it. This is how it looks before editing:
Code:
multi(0)disk(0)rdisk(0)partition(1)\WINDOWS="Microsoft Windows XP Professional" /noexecute=optin /fastdetect
and this is how it should look after
Code:
multi(0)disk(0)rdisk(0)partition(1)\WINDOWS="Microsoft Windows XP Professional" /noexecute=optin /fastdetect /basevideo
6. Save the edited boot.ini. Close Parallels Explorer. Boot your VM again.
This time you should see a graphics instead of blank screen