I can confirm this bug report on Ubuntu 16.0.4.3LTS 4.4.0-112-generic x68_64 Play on Linux version: 4.2.10 Bug observed with wine prefixes: v3.1 x86, v1.9.19 x86
On my system, this infinite loops causes the reported error message to be written to ~/.cache/upstart/unity7.log over and over again. While this error is being logged, inspecting the registry of the affected wine prefix reveals that the registry key 'HKEY_LOCAL_MACHINE\Software\Microsoft\NET Framework Setup\NDP\v3.5' does not exist. Adding it manually either during or before the dotnet35 setup has no effect.
