I tried to upgrade my existing Windows 7 RTM VM to the new Parallels 5 version by upgrading. Unfortunately Parallels Tools failed with an Error 2738, Could not access VBScript run time for custom action.

The solution was to remove the stale HKCU registry key for the VBScript.dll registration:

http://blogs.msdn.com/astebner/archive/2007/06/07/3151752.aspx

Update: As I am forced to do this with EVERY update to Parallels now, here are the basic steps:

1. Click on the Start menu, choose Run, type cmd and click OK

2. To unregister the VBScript engine, run this command:

   reg delete "HKCU\SOFTWARE\Classes\CLSID\{B54F3741-5B07-11CF-A4B0-00AA004A55E8}" /f
   

3. To unregister the VBScript engine on a 64-bit OS, run this command:

   reg delete "HKCU\SOFTWARE\Classes\Wow6432Node\CLSID\{B54F3741-5B07-11CF-A4B0-00AA004A55E8}" /f