Comment 2 for bug 1707085

Just to build on what Sean's already said: one guest should not have more vcpus than the total number of available physical cpus. This is why max_unit gets set to what it is set at.

Note that if you requested a new guest with 4 VCPUs, it would get placed. max_unit describes the limit per guest, where allocation_ratio modifies the limits overall. So you can oversubscribe as much as you like across many guests, but not per individual guest (as that would cause the pathological performance Sean describes).