Ok, I can confirm that with:
Version of System Firmware is FW860.70 (SV860_205) (t) FW860.70 (SV860_205) (p) 
FW860.70 (SV860_205) (b)

Guests now run fine not crashing into the issue they had before.

This FW still has:
ubuntu@wichita:~$ sudo qemu-system-ppc64 -enable-kvm -nographic -machine 
pseries-3.1,cap-cfpc=fixed
qemu-system-ppc64: Requested safe cache capability level not supported by kvm, 
try cap-cfpc=workaround

The same happens to many other P9 only features, but that is fine.
At least broken and workaround work now (and the default without adding an 
argument).

Marking as resolved.

** Changed in: qemu (Ubuntu)
       Status: Confirmed => Invalid

** Changed in: ubuntu-power-systems
       Status: In Progress => Fix Released

** Changed in: ubuntu-power-systems
     Assignee: bugproxy (bugproxy) => (unassigned)

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https://bugs.launchpad.net/bugs/1839065

Title:
  power8 machines need FW update or qemu/libvirt code - cap-cfpc=broken

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