Ah. I see.  I realize I was thinking guest because of LP bug #770565
involved the same symptoms in a vbox guest.

Forget VirtualBox actually, I see the problem:  you are enabling selinux on 
your kernel command-line:
ProcKernelCmdLine: BOOT_IMAGE=/vmlinuz-2.6.38-8-generic 
root=/dev/mapper/hostname-root ro quiet splash security=selinux selinux=1 
vt.handoff=7

You can't run SELinux and AppArmor at the same time.  If you want to run
AppArmor, remove "security=selinux" and "selinux=1" from your kernel
command-line parameters in /boot/grub/grub.cfg.  You might need to add
"security=apparmor" (not sure that's necessary though).

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https://bugs.launchpad.net/bugs/786839

Title:
  AppArmor does not and cannot start

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