I had this similar problem installing a zone in OpenSolaris build 129 running 
inside virtualbox 3.0.4 on top of OpenSolaris 2009.06 snv_11b. The funny thing 
here is that my OpenSolaris 2009.06 host box is in a datacenter and has a full 
100mb/s connection out to the internet, but my build 129 guest is having 
problems with downloading IPS packages even though there's not all that much 
network activity on the host. Here's the output from installing a zone (which 
of course, downloads packages from IPS which seems unneccessary IMO):

# zoneadm -z dhcpzone install
A ZFS file system has been created for this zone.
   Publisher: Using opensolaris.org (http://pkg.opensolaris.org/dev/ ).
       Image: Preparing at /export/zones/dhcpzone/root.
/usr/lib/python2.6/vendor-packages/pkg/client/api_errors.py:295: 
DeprecationWarning: BaseException.message has been deprecated as of Python 2.6
  self.message = message
pkg: 0/1 catalogs successfully updated:
   
1: Framework error: code: 28 reason: Operation too slow. Less than 1024 
bytes/sec transfered the last 30 seconds
URL: 'http://pkg.opensolaris.org/dev'. (happened 7 times)
2: Framework error: code: 28 reason: Connection time-out
URL: 'http://pkg.opensolaris.org/dev'.

/usr/bin/pkg:2014: DeprecationWarning: BaseException.message has been 
deprecated as of Python 2.6
  if cre.message:
ERROR: failed to create image
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