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0e1f616
(Get the code!)
@lifeless,
the upstart job is only responsible for setting up the kvm kernel module and related kernel settings. With my new proposed change, the upstart job would detect it's in a container and consider itself done.
In reality, for quantal the modprobes and rmmods were already doing '|| true'. So the only thing my new upload changes is that rather than try to do all these things and be denied, it won't try. (Or, rather than try to do them and succeed due to a bad policy, and potentially break the host.)
The host will have to set up kvm; but it would have to anyway, since containers are never allowed to modprobe by default. And quantal and later always modprobe kvm on the host.
Finally, libvirt and python-libvirt do not depend on qemu-kvm. But again, qemu-kvm will install just fine and even be usable in the container. It just can't be set up there.