Comment 2 for bug 1510511

I tried that command (on current xenial, you didn't specify an Ubuntu release/package version), and it works fine:

$ machinectl pull-raw https://cloud-images.ubuntu.com/trusty/current/trusty-server-cloudimg-amd64-disk1.img
Download of https://cloud-images.ubuntu.com/trusty/current/trusty-server-cloudimg-amd64-disk1.img complete.
SHA256 checksum of https://cloud-images.ubuntu.com/trusty/current/trusty-server-cloudimg-amd64-disk1.img is valid.
gpg: Signatur vom Mi 28 Okt 2015 03:01:23 CET mittels RSA-Schlüssel ID 7DB87C81
gpg: Korrekte Signatur von "UEC Image Automatic Signing Key <email address hidden>" [unbekannt]
gpg: WARNUNG: Ein Schlüssel ohne gesichertes Vertrauen wird benutzt!
Signature verification succeeded.
Unpacking QCOW2 file.
Created new local image 'trusty-server-cloudimg-amd64-disk1'.
Operation completed successfully.
Exiting.

$ machinectl list-images
NAME TYPE RO USAGE CREATED MODIFIED
trusty-server-cloudimg-amd64-disk1 raw no 815.5M n/a Do 2015-10-29 14:23:43 CET

Actually trying to start the container fails due to

Okt 29 14:26:25 donald systemd[1]: Starting Container trusty-server-cloudimg-amd64-disk1...
Okt 29 14:26:25 donald systemd-nspawn[10918]: Failed to open /dev/loop-control: Operation not permitted
Okt 29 14:26:25 donald systemd[1]: systemd-nspawn@trusty\x2dserver\x2dcloudimg\x2damd64\x2ddisk1.service: Main process exited, code=exited, status=1/FAILURE

But that sounds like a separate problem.

> Failed to convert qcow2 image: No space left on device

That sounds like the actual cause for what you see? :-) Can you confirm that it works with enough disk space?