on 32-bit OS same problem
ok, did a complete re-install on windows 32-bit: same problem

I can't believe not more people are experiencing this issue, and parallels support is suggesting ridiculous steps to re-install the parallel tools:
1. Start Windows Virtual Machine.
2. Click on Start menu -> Control Panel -> Add/Remove Programs/Programs and features and uninstall Parallels Tools if it is present.
3. Go to My Computer -> C Drive -> Program Files -> Parallels folder and delete the Parallels Tools folder, if present.
4. Click on Start menu -> Run(search box) and type regedit. Hit OK.
5. In Registry Editor, go to "My Computer\HKEY_LOCAL_MACHINE\SOFTWARE\Parallels" and delete the "Parallels Tools" entry, and go to "My Computer\HKEY_CURRENT_USER\SOFTWARE\Parallels" and delete the "Parallels Tools" entry.
6. Go to Start menu -> Run(search box) and hit Enter/Return ->(search box) type %temp% and hit Return -> select all files under this Temp folder and delete them permanently (also from Recycle Bin).
7. On the top Mac menu bar, click on Devices -> CD/DVD -> Connect Image. Browse to Mac HD\Library\Parallels Tools. Select "prl_tools_win.iso" and click on Open.
8. Wait for a minute and you will get the Auto-play window. Click on "Install Parallels Tools".
-OR-
If you do not get the Auto-play window, go to Start(Windows logo) -> Computer. Double click on the CD/DVD drive which would read "Parallels Tools". If it shows the contents, double click on "setup.exe".