same problem
I'm experiencing what looks like the same problem
I have a macbook pro and a mac pro: both run snow leopard (10.6.1); I have been using parallels desktop 4 with the windows XP of my BootCamp partition; I purchased two upgrades to paralells desktop 5; I installed one on the macbook pro and it worked fine: it initially told me that it couldn't find the VM, but then I restarted the macbook pro, tried again and it worked; I just tried to install 5 on my mac pro and it doesn't work; windows XP starts, then I get long an error message stating that windows had to be stopped and asking whether I want to restart normally or use last known configuration; in both cases, it tries to restart and I get the same error, over and over again; in short, it doesn't work; I started windows from within bootcamp and it works;
I contacted support and, as it happened with my last support problem, I started receiving unhelpful suggestions, such as reducing the number of processors to 1 (it was already the case), re-installing the VM, etc.; with my previous problem it took over a month before a qualified support person finally stepped in and solved the problem;