I encrypted my Windows 10 VM before realising that this prevents reclamation of space. I have tried to remove encryption but it keeps telling me I need 58.2GB of space available. I now have 178.1GB free having deleted a ton of space to provide enough space for the decryption and yet the same error.
I'm running macOS 10.13 and VM Fusion 10.0.1
Would you please confirm if there is 'purgeable' content in your Mac host?
Please check 'About This Mac-->Storage' and see if there is any 'purgeable' content in the status bar of Storage.
If yes, you need to free it then try the decryption once again.
One thing - I've noticed that High Sierra no longer lets you disable local time machine backups. Make sure time machine is running - if it's configured, but the drive isn't attached, you can lose hundreds of gigabytes.