AFAICS there is no tracking of this in bugzilla:

Every time livecd-tools is run this is shown:

  Installing: selinux-policy-targeted      ##################### [725/764]
SELinux:  Could not downgrade policy file /etc/selinux/targeted/policy/policy.26, searching for an older version.
SELinux:  Could not open policy file <= /etc/selinux/targeted/policy/policy.26:  No such file or directory
load_policy:  Can't load policy:  No such file or directory

SE generally seems to work ... probably because of the precompiled policy?

I don't know if livecd-tools should do some more tricks or if SE should be changed or the warnings hould be muted ... but something should be done.

 
livecd-tools-16.3-1.fc16.x86_64
selinux-policy-targeted-3.10.0-21.fc16.noarch

Same kernel and policy version is running on the build host and in the image it is building. Enforcing is permissive.