SymptomsYou compressed the virtual machine's hard drive and cannot start Windows XP virtual machine after that.
CauseWindows XP cannot detect new hard drive size.
Resolution1. Open the configuration of the virtual machine.
2. Under Hardware section click the CD/DVD-ROM to open its settings.
3. Make sure that 'Connected' option is checked and Source/CD/DVD-Rom is set to "Default CD/DVD-ROM" or Model of your CD/DVD-Rom is selected in the list.
4. Click the "Boot Order" on the left side of the Configuration Editor if it is Parallels Desktop 4.0 and then set the boot sequence to CD-ROM, Hard Disk, floppy.
5. Click OK to close the Configuration Editor.
6. Insert the installation disk in the Windows XP CD/DVD drive in your Mac.
7. Start the virtual machine.
8. Windows should ask you to press any key to boot from the CD - click in the window of the VM to capture the keyboard input and press any key.
9. The configuration of Windows must start the Setup process, wait until it is fully loads and then press Enter (Return).
10. Press F8 (or Fn + F8 keys on the Macbook) to accept the license agreement for Windows.
11. Select Recovery Console from the list of options.
12. Run fixboot and fixmbr commands.
13. Change the Boot Order of the virtual machine back to Hard Disk - CD-ROM - Floppy.
14. Restart Windows.