Yea, I used the Fn+F1/F8 no dice.
nah, I haven't tried repairing from iso, but I deleted the VM, and re-installed windows 11 again; everything was successful multiple reboots came back ok, and everything worked fine until I powered off the VM and quit VMWare fusion, then launched vmware fusion and tried to start the windows VM and got the same recovery error.
No updates got installed when I shut down the VM, I even checked for updates but none was found
Yes the VM was encrypted and TPM shows up in the settings