I have a same Problem that is 0x800F0950
M1 / Parallels / Win10(ARM)
This method can solve my problem
Install the latest Windows Insider Preview updates
https://kb.parallels.com/125526
Form Parallels official website
Hope it could help everyone!!
spent more than 5-6 hours checking all other guides & videos to install .Net framework 3.5 on my M1 Parallels, nothing worked but voila finally thanks to you and the above article its now resolved..
Cheers !!