I went to disk Mgt rt clicked but no choice to initialize.
Should I initialize from the error msg on the Mac side?
If you are not getting a message from within Windows then as far as the Virtual Machine is concerned then you don't need to do anything in Windows however if you're still getting a message of some sort that is in reference to the external hard drive then I need to see a screenshot of it as I asked for in one of my previous replies. Obviously I can't see what you're looking at nor from where the message is being generated so I can't comment further without the facts being presented in context and I'm sure you can understand that. 
btw thanks for your patience.
No problem. (Although I have to admit if I don't get the information I need I will loose my patience.)
i can live with it as long as the drive is working on the VM.
That's fine if you're okay with it that's all that matters although if I were in your situation I wouldn't accept anything shy of a proper resolution to the issue. (To each their own.)
I can't send you a picture b/c as soon as I click on anything it disappears.
All it is , is a box that says" DiskDrive cannot be recognized by this computer.
Initialize, Ignore , Eject".
Thats it , then it,s gone .
I find that hard to believe that if you're not clicking specifically on one of the choices that the message disappears by itself however not saying it can't happen as it may have a built in time out or something else is wrong, whatever.
One reason I wanted a picture is because you have yet to say which OS, OS X or Windows or if Fusion itself is throwing the message box and explicitly and specifically the exact events that take place that causes it to appear and a picture would in all likelihood tell me more information then I have so far.
Anyway have you clicked the Initialize button and if so what if anything happens/happened and does this message box continue to appear and what are actual events that lead to it appearing?
Also feel free to just drop it as I'm just following up with this for completeness on the situation if you choose to attempt to rectify this issue.
Thanks for all your time.
No problem.
I can see the Drive is also listed on the Mac side.
Okay, thats nice to know but without context it doesn't say a lot. I'm not trying to be difficult really, but "is also listed on the Mac side" by itself doesn't paint a full picture. Do you mean on the Desktop, Finder, Disk Utility and or System Profiler? and if it's "also listed on the Mac side" and say on the Desktop and at the same time in Windows and you have connected the USB Drive to Windows then this is a problem however if "also listed on the Mac side" is in System Profiler and you have connected the USB Drive to Windows then this in normal and to be expected. Do you see why just saying "I can see the Drive is also listed on the Mac side" and not putting it in context is meaningless by itself?
Does this help?
The image you attached helps in that I now know that OS X is throwing the message box not Fusion or Windows.
However you didn't answer my question "Anyway have you clicked the Initialize button and if so what if anything happens/happened and does this message box continue to appear and what are actual events that lead to it appearing?"
Please understand the the reason we ask that Users read is so the User will provide adequate information so we do not have to ask many of the basic questions and also impress upon the User that we are not mind readers and some issues require a fair amount of details to analyze the situation and certainly lack of information and then not answering the specific questions being asked just makes this frustrating to deal with.
Anyway you said you can "live with it as long as the drive is working on the VM." so I'm going to leave this alone and leave you with a piece of advice. You should never settle for a condition when you are continually being prompted by a message and continue to ignore it and especially when its in regards to Mass Storage Devices because you can potentially end up loosing everything on the Device if it is not being properly passed between the Physical Machine and Virtual Machine as USB Mass Storage Devices can have the Filesystem trashed under the right conditions and this is true just with Physical Machines and connecting/disconnecting USB Mass Storage Devices so add to that what takes place between Physical Machines and Virtual Machines under the same condition and I'd venture to say the potential for a problem when something is not being resolved is an accident waiting to happen.
Again not trying to be difficult and only trying to help resolve an issue and hopefully as others read this thread they'll understand not ever issue can be described in a sentence or two nor can they always be answered in a sentence or two. Many can but this isn't one of them.