This bug was fixed in the package qemu - 1.4.0+dfsg-1expubuntu4

---------------
qemu (1.4.0+dfsg-1expubuntu4) raring; urgency=low

  * re-add qemu-system-x86.modprobe to set nesting=1 (LP: #1155177)
  * qemu-system-x86.qemu-kvm.upstart:
    - remove NESTED workarounds from upstart file.
    - remove loading of modules which is now always done
    - remove TAPR define which is no longer used
  * move customizable defines back to qemu-kvm.default
  * copy creation of group kvm to preinst - the group must exist when the
    kvm udev rule is installed (LP: #1103022) (LP: #1092715)
  * add adduser to qemu-system-common Pre-Depends for use by preinst.
 -- Serge Hallyn <serge.hal...@ubuntu.com>   Thu, 14 Mar 2013 14:21:53 -0500

** Changed in: qemu (Ubuntu)
       Status: In Progress => Fix Released

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https://bugs.launchpad.net/bugs/1155177

Title:
  nested=1 not taking effect

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