Creating a template with block domain as dst domain out a VM with a disk located on a file domain succeeded.
Creating a VM out of this template and starting it works fine also.
Verified against ovirt-3.5 rc1 where the bug occurs.
Verified using rhev-3.4 av11.1.
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/RHSA-2014-1161.html