I have just setup a test environment for VMware Workstation on a Windows based system, with the same configuration as you have entered (10.8.241.0, 255.255.0.0) and received the same error message as you got.
However, when changing the third octet of the subnet mask to 255.255.255.0 there were no issues, and it was accepted with no error message. Modifying the third octet to any other 'theoretically' valid values forced the error message to return.
Run out of time, so when I have a moment, I will put my networking thinking cap on to try and figure out why this might be occurring.
