I ended up reinstalling VMWare fusion 6.0.1, from 6.0.2. (not just using 6.0.1 tools on 6.0.2)
The truncation problem is gone (although I experience a slight sync delay once in a while).
I am not sure why I was unable to get the 6.0.1 tools + 6.0.2 fusion combo to work to stop the truncation problem. For my VMs, it required doing a full install of 6.0.1 VMWare fusion to fix the problem.