Found the problem. There was an old registry entry at 'HKLM\SOFTWARE\VMware, Inc.' named 'VMware Infrastructure Update Manager - PowerShell Library' that had a key name 'Installedversion' with the old version number there.
For some reason, the installer does not check the version number to determine if it you are installing a newer version. The installer saw the existing key (that had a value of '1.something') and decided it was going to quit.
Hopefully this will help others who may fight the old version issue.
Good luck.
Erik Gross
erik.gross@gdc4s.com