You might be right about that - though I'm not sure if it's an issue or a new requirement by Apple. After doing some further research on my issue and collecting a system log bundle of the 60 seconds before and during virtual machine startup, I came across this:

2023-07-28 15:57:25.512195-0400 0x68ab Default 0x0 3433 0 vmware-vmx-debug: (AppKit) The application with bundle ID com.vmware.vmware-vmx-debug is running setugid(), which is not allowed. Exiting.