Description of problem: oVirt 3.3 introduced the ability to place an ISO domain on ANY file-based domain, including local storage. oVirt Live's treatment of ISOs could be simplified to use this ability and save the need to set up an NFS server that serves a local directory just so it can be used as a domain.
As we move from oVirt live to Lago, we won't be able to handle this (that being said, we should add ISO domain support to Lago as well).