Welcome to the Community,
When i choose to Install an OS later it says " vmware cannot connect the virtual device sata 0:1 "
I assume you get this error message, when you try to attach the ISO to the already created VM!?
What you may try as a workaround is to create the VM with "I will install to OS later". Then open the VM's settings, delete the virtual CD-ROM drive, and add a new "IDE" CD-ROM drive.
André