VMWare Images are actually ISO images that you can use to create your own Virtual Machine.
When you install VMware on your computer it does not automatically get the VMware Tools because VMWare Tools is something you install separately.
If you run the installation and follow the steps to add a Custom Install and select VMWare Tools as the Install Type, you get what you want.
Here is the link to VMware Tool installation guide for Windows.
You can also search for VMware Tools on the site
To answer your question first, why is it possible to run Windows 3.11 without having a workgroup in the name, but not possible for Windows 2000/XP?
The reason is that Windows 3.11 was released in 1989, and Windows 2000/XP was released in 2001, and both of these operating systems are available in two different revisions, and having one without a workgroup in the name is a subset of one of them.
In 1989, Windows 3.11 was Release 3.0, and Windows 2000 was Release 5.5.
In 2001, Windows 2000 was Release 6.0, and Windows XP was Release 6.2.
This means that your USB or ISO image must have the "higher level" version of Windows in order for it to run correctly.
"UnicodeDecodeError: 'utf8' codec can't decode byte" on Powershell console
I am beginner in Powershell. I tried to create a new PS console in CMD and I am getting error "UnicodeDecodeError: 'utf8' codec can't decode byte". My powershell version is 5.0 and I am using Windows7 64bit. I did not face this issue in any other machine.
Here is the code which I ran in CMD (though in few machines the issue is not there):