After unsuccessfully trying to install/update the VMWare tools on a Server 2003 host I decided to manually download and install the files. This is where I got it:
https://packages.vmware.com/tools/esx/latest/index.html 

Note that after unpacking the downloaded tools that you should replace the “CDROM” location with the location of the unpacked VMWare tools path.

To uninstall and reinstall VMware Tools:
  1. Right-click the virtual machine and click Guest > Install/Upgrade VMware Tools.
  2. Open a Console to the virtual machine and log into the guest operating system.
  3. Click Start > Run, type cmd, and click OK. A Command Prompt window opens.
  4. Change the drive to your CD-ROM drive (For example, D:\).
  5. Type setup /c and press Enter to force removal of all registry entries and delete the old version of VMware Tools.

    Note: For 64-bit guest operating systems, type setup64 /c

  6. Open My Computer and double-click the CD-ROM that contains VMware Tools.
  7. After Auto-Run starts, follow the prompts to install.

    Note: This must be done from the GUI interface. Do not launch the install by running Setup from the Command Prompt. Also ensure that the CD-ROM is enabled. In the virtual machine properties select CD-ROM under Device Status, and ensure that Connected (if the virtual machine is powered on) and Connect at power on are selected.

  8. When the installation completes, reboot the guest operating system.

Reference:
http://kb.vmware.com/selfservice/microsites/search.do?language=en_US&cmd=displayKC&externalId=1012693

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