I had the same problem with converter (v5.0.1) - converter reported error described above when configuring the created VM (the previous steps of creating the VM were successful, but reconfiguring the VM failed).
After reading the posts here I saw that it is possible to just reconfigure the created VM. I have tried and got the same error as before.
I have also noticed that user lolhaha changed the memory. So I though that maybe I do not have enough free memory. I am having a 32 bit OS with 3.5 GB of available ram. The VM was created with 2.2 GB assigned. At the time of getting the error I have only 1.8 GB available (as reported by Task manager).
I have restarted Windows and than opened the Converter application again. At that time I had 2.6 GB available ram. I have repeated the configure step in converter and after a minute got SUCCESS (in configure options I have unchecked everything except the last option - reconfigure VM). The new VM is running successfully.
This probably means that the converter does not have enough ram to make the configuration. If this is the reason, than it would be really helpful to inform the user about that and not display the:
Error: An error occurred during reconfiguration.
Status: FAILED: Unable to create '\\.\vstor2-mntapi10-shared-7AA2989B00005006000000000A000000\$Reconfig$'.