I got this error after an upgrade to hardy-backports and hardy-proposed
and found this ticket while troubleshooting.

My solution was to remove the display device, start the VM headless, and
then re-add the display device.  This seemed to cleanup the virt-manager
configuration file.  I didn't have a port conflict.

-- 
second virtual machine raises error
https://bugs.launchpad.net/bugs/219714
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