The precompiled binary modules in VMwareTools are not up to date with latest kernels for CentOS 5.3. To get around this, we compile modules for our kernel. We then distribute these modules with virtual machines that do not include gcc or other tools necessary to recompile tools.

If vm is setup to automatically check and update tools, will the update fail because if latest tools do not contain modules for kernel and vm doesn't contain gcc to compile new modules?

This is important because we don't ship virtual appliances with gcc necessary to compile tools - and our experience is that VMware does not keep up with compiled modules for every kernel update shipped by our Linux vendor(s).