Let's try to simplify. What happens if you run kvm by hand as such:
qemu-img create root.img 10G kvm -m 8192 -smp 6 -vga cirrus -boot d -drive file=root.img,if=virtio,index=0 -cdrom /var/lib/libvirt/images/LinuxISOs/ubuntu-8.04-server-i386.iso
?
Let's try to simplify. What happens if you run kvm by hand as such:
qemu-img create root.img 10G img,if= virtio, index=0 -cdrom /var/lib/ libvirt/ images/ LinuxISOs/ ubuntu- 8.04-server- i386.iso
kvm -m 8192 -smp 6 -vga cirrus -boot d -drive file=root.
?