I tried three upstream kernels including 3.6.2-030602-generic and it does not 
fix the issue.
And yes it primarily is a quantal issue, as quantal has 3.5+ kernel by default.
Unfortunately cannot go to older kernels, as they have a suspend problem with 
this brand new machine :(

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https://bugs.launchpad.net/bugs/1063491

Title:
  vmware workstation does not work anymore with 3.5.0-17 did with -16

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