I checked with danpb on IRC, and confirmed that when nova asks libvirt for a VM with KVM, it will invoke qemu such that it will fail if KVM can not be used.  So, this is needed for nova to work in a test environment using VMs.

To be explicit, appropriate action for now is to expose the kvm v qemu option.

(In reply to Stephen Gordon from comment #3)
> To be explicit, appropriate action for now is to expose the kvm v qemu
> option.

Right, there are other values that nova accepts for this option, but they should *not* be allowed.

In the future we may also add support for other drivers, so I am thinking a radio option like this:

    Driver:
        (    ) Libvirt/KVM
        (    ) Libvirt/QEMU
        (    ) vCenter

Even though Libvirt/KVM and Libvirt/QEMU are really the same driver with different virt_type setting the this should be handled behind the scenes.

Similarly when we add vCenter it has a host of other options to configure, different to the Libvirt ones, but we can consider that in a later phase.

Also note that packstack does this detection and setting automatically using the following bits:

  packstack/puppet/modules/packstack/lib/facter/is_virtual_packstack.rb

  Facter.add("is_virtual_packstack") do
    setcode do
      Facter::Util::Resolution.exec('grep hypervisor /proc/cpuinfo > /dev/null && echo true || echo false')
    end
  end

(In reply to Russell Bryant from comment #6)
> Also note that packstack does this detection and setting automatically using
> the following bits:
> 
>   packstack/puppet/modules/packstack/lib/facter/is_virtual_packstack.rb
> 
>   Facter.add("is_virtual_packstack") do
>     setcode do
>       Facter::Util::Resolution.exec('grep hypervisor /proc/cpuinfo >
> /dev/null && echo true || echo false')
>     end
>   end

While this seems like a handy puppet approach to doing the check, I don't think it's right.  I don't get this on my laptop for example.  I think the check needs to be for something else (vmx or svm, I think).

Since the problem described in this bug report should be
resolved in a recent advisory, it has been closed with a
resolution of ERRATA.

For information on the advisory, and where to find the updated
files, follow the link below.

If the solution does not work for you, open a new bug report.

http://rhn.redhat.com/errata/RHBA-2014-1090.html