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I am trying to install vCenter 6.5 on windows as a standalone server and I am getting that error message. Does vCenter 6.5 need to be deployed as a VM on an ESXi host? If it can be installed on a physical windows machine, how do I get past this error message?

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If you are trying to install the Linux appliance based vCSA version of vCenter then the answer is yes: You can only install it as a VM on an existing ESXi host.

With version 6.5 (and 6.7) vCenter is also still available in a Windows version which can also be installed on a physical Windows server. However, I do not recommend that, because VMware has clearly stated that the Windows version of vCenter is obsolete and will become unavailable with future vSphere versions (see https://blogs.vmware.com/vsphere/2017/08/farewell-vcenter-server-windows.html)

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