Public bug reported:

We've found that having vhost_net module and using bridged networking
breaks DHCP and (some?) guests do not get an IP address.

The issue has been properly described in the following RH doc:

http://docs.redhat.com/docs/en-
US/Red_Hat_Enterprise_Linux/6/html/Virtualization_Host_Configuration_and_Guest_Installation_Guide/ch11s02.html

"11.2.1. Checksum correction for older DHCP clients"

Their workaround works in Precise too in fact.

Another workaround is to disable/unload the vhost_net module so new
guests do not make use of it.

RH has fixed this stuff in libvirt apparently:

"This iptables rule is programmed automatically on the host when the
server is started by libvirt, so no further action is required"

My apologies if this stuff does not belong to libvirt.

Some info from our environment:

compute-002:~# lsb_release -rd
Description:    Ubuntu 12.04 LTS
Release:        12.04

compute-002:~# uname -a
Linux compute-002 3.2.0-27-generic #43-Ubuntu SMP Fri Jul 6 14:25:57 UTC 2012 
x86_64 x86_64 x86_64 GNU/Linux

compute-002:~# dpkg -l|egrep "kvm|libvirt|dhcp|dns"
ii  dnsmasq-base                       2.59-4                                   
 Small caching DNS proxy and DHCP/TFTP server
ii  dnsmasq-utils                      2.59-4                                   
 Utilities for manipulating DHCP leases
ii  dnsutils                           1:9.8.1.dfsg.P1-4ubuntu0.1               
 Clients provided with BIND
ii  isc-dhcp-client                    4.1.ESV-R4-0ubuntu5.1                    
 ISC DHCP client
ii  isc-dhcp-common                    4.1.ESV-R4-0ubuntu5.1                    
 common files used by all the isc-dhcp* packages
ii  kvm-ipxe                           1.0.0+git-3.55f6c88-0ubuntu1             
 PXE ROM's for KVM
ii  libdns81                           1:9.8.1.dfsg.P1-4ubuntu0.1               
 DNS Shared Library used by BIND
ii  libnet-dns-perl                    0.66-2ubuntu3                            
 Perform DNS queries from a Perl script
ii  libvirt-bin                        0.9.8-2ubuntu17.2                        
 programs for the libvirt library
ii  libvirt0                           0.9.8-2ubuntu17.2                        
 library for interfacing with different virtualization systems
ii  munin-libvirt-plugins              0.0.6-1                                  
 Munin plugins using libvirt
ii  nova-compute-kvm                   
2012.1+stable~20120612-3ee026e-0ubuntu1.2 OpenStack Compute - compute node (KVM)
ii  python-libvirt                     0.9.8-2ubuntu17.2                        
 libvirt Python bindings
ii  qemu-kvm                           1.0+noroms-0ubuntu14                     
 Full virtualization on i386 and amd64 hardware

We've also tested this with kernel 3.5 backport from Quantal:

Linux compute-002 3.5.0-6-generic #6~precise1-Ubuntu SMP Tue Jul 24
14:45:23 UTC 2012 x86_64 x86_64 x86_64 GNU/Linux

The guest is running Debian Squeeze:

debian-squeeze-amd64-ext3:~$ uname -a
Linux debian-squeeze-amd64-ext3 2.6.32-5-amd64 #1 SMP Mon Jan 16 16:22:28 UTC 
2012 x86_64 GNU/Linux

debian-squeeze-amd64-ext3:~$ dpkg -l|grep dhcp
ii  isc-dhcp-client                     4.1.1-P1-15+squeeze3         ISC DHCP 
client
ii  isc-dhcp-common                     4.1.1-P1-15+squeeze3         common 
files used by all the isc-dhcp* packages

** Affects: libvirt (Ubuntu)
     Importance: Undecided
         Status: New

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https://bugs.launchpad.net/bugs/1029430

Title:
  KVM guests networking issues when bridge and vhost_net kernel modules
  loaded

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