It does (or should) go to fallback mode however Big Kernel Lock (BKL) was removed on kernels >= 2.6.37 and VMWare Tools won't install so your joy would have been short lived. I Googled around and tried a couple of patches but none of them gave me any joy. Apparently you can downrev your kernel and get it to work but that seems counter productive. So for the time being I am stuck with Fedora 14 (which is end of lifed in December).

The issue has existed for some time and was one of the reasons my trial of Fedora 15 was short lived (Gnome 3 and no Dropbox being the others) but I thought VMWare would have fixed it by now...