>It appears that the xenial-updates/ocata/main repository has zesty
packages in it where it should > only have xenial. Correct?

No it is exactly right doing it that way, the cloud archive is essentially a 
(much) better backport ppa.
It contains the given openstack version and its dependencies. When Ocata was 
released it was the Ubuntu zesty release.
The cloud archive makes this stack available on the latest LTS.

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https://bugs.launchpad.net/bugs/1703423

Title:
  zesty qemu packages (2.8) released for xenial-updates

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