I have now installed ubuntu-virt-mgmt and ubuntu-virt-server on amd64
Karmic USB-Stick, and successfully installed Karmic inside a new vm.  So
the issue seems to be specific to my setup.

I'll now try to find a spare USB-Disk and 
- install a Jaunty, 
- update all packages,
- install Jaunty into a guest
- update the host to Karmic
- test the Jaunty VM
- test installing Karmic

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Cannot start existing VM after upgrade to 9.10 beta
https://bugs.launchpad.net/bugs/448694
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