Comment 4 for bug 1334749

As the original report says, this doesn't seem to be an upstream issue. As I reported there, Fedora with libvirt 1.2.5 didn't have this problem; and on the Xen4CentOS packages, neither libvirt 0.10 nor libvirt 1.2.10 had this problem. In all cases, if you booted under Xen, virsh would find Xen without any extra hand-holding. In the case of Xen4Centos libvirt 1.2.10 packages, I can see that there are no patches changing any defaults.

It seems likely that somewhere Ubuntu has actually added something which is changing the default URI to KVM.