Just an update. After working for a few days with VMWare support with no solution, I returned back to V3. I followed the instructions posted elsewhere in the forums paying attention to the following:
* Remove any remnants of VMWare tools on the V4
* Following the instructions to return to V3
* Installed VMWare Tools though it failed on a couple items the first time but did go through the install
* Manually installed the items that failed one-by-one
Everything works fine again. I will wait awhile to upgrade to V4 as I lost 3 evenings trying to fix it.