Hi,
there is no point in installing from a USB thumb drive. Just upload the ISO file to the datastore of the host and boot the VM from that ISO. You have to edit the settings of the VM: Hardware -> CD/DVD drive 1 -> select "Datastore ISO File" in tghe right pane and press Browse button to select the Win 2k12 ISO you uploaded. Also be sure to select "Connect at power on" below "Device status", click OK.
Power on the VM and it should boot into the ISO / setup of Win 2k12.