SOLVED: How to Upgrade or Install Windows Server 2016/19 Standard VM on a Windows Server Data Center Host

The short version is that if your host server is running Datacenter you can NOT upgrade an existing Windows Server 2016/2019 STANDARD Virtual Machine to anything but Datacenter.  If you try you will see that Windows Server STANDARD is missing and not an option from the list.  The way it was explained to me is: Datacenter upgrades to Datacenter ONLY.  Windows Server Standard is missing from the upgrade list, by design:

There is also no way to downgrade your Windows Server Datacenter install to the Standard version.

However, there is a way to install STANDARD VM’s on a Windows Server 2016/2019 Host but you cannot do it with the DVD or a USB stick.  You have to pull Windows Server Standard from the Windows Server Datacenter DVD (yes, it is hidden in there) into a Windows Deployment Server (WDS).  After Windows Server Standard is in WDS you can have new VM’s PXE boot your new VM to it and select Windows Server Standard.

To add the Windows Server Standard image to your WDS:

1. On your WDS server either MOUNT your Windows Server .ISO or insert the DVD disk
2. Launch Windows Deployment Services console
3. Right click and select ADD IMAGE
4. Browse for the INSTALL.WIM file
5. Click NEXT through the reset of the wizard

You will also need to add the BOOT.WIM to your BOOT images using the same process