As pointed out by Alex, starting the dnsmasq service makes the libvirt
network to crash and not start.

So I found a work-around for this: you must set the option "bind-
interfaces" in the "/etc/dnsmasq.conf" file to tell the dnsmasq daemon
to bind itself to the interface specified in the config file.

This solved the problem for me.

** Description changed:

  On ubuntu server 10.10 x64, using libvirt-bin 0.8.3-1ubuntu14
  
  With virt-manager on a workstation (ubuntu 10.10 x64 desktop), connected
  via ssh, trying to start default network  :
  
  Traceback (most recent call last):
-   File "/usr/share/virt-manager/virtManager/host.py", line 401, in 
start_network
-     net.start()
-   File "/usr/share/virt-manager/virtManager/network.py", line 97, in start
-     self.net.create()
-   File "/usr/lib/python2.6/dist-packages/libvirt.py", line 866, in create
-     if ret == -1: raise libvirtError ('virNetworkCreate() failed', net=self)
+   File "/usr/share/virt-manager/virtManager/host.py", line 401, in 
start_network
+     net.start()
+   File "/usr/share/virt-manager/virtManager/network.py", line 97, in start
+     self.net.create()
+   File "/usr/lib/python2.6/dist-packages/libvirt.py", line 866, in create
+     if ret == -1: raise libvirtError ('virNetworkCreate() failed', net=self)
  libvirtError: internal error '/sbin/iptables --table filter --delete INPUT 
--in-interface virbr0 --protocol udp --destination-port 69 --jump ACCEPT' 
exited with non-zero status 1 and signal 0: iptables: Bad rule (does a matching 
rule exist in that chain?).
  
  After adding the rule,
  sudo /sbin/iptables --table filter -A INPUT --in-interface virbr0 --protocol 
udp --destination-port 69 --jump ACCEPT
  
  I get the following error (with virsh) :
  sudo virsh net-start default
  erreur : Impossible de démarrer le réseau default
  erreur : internal error '/sbin/iptables --table mangle --delete POSTROUTING 
--out-interface virbr0 --protocol udp --destination-port 68 --jump CHECKSUM 
--checksum-fill' exited with non-zero status 2 and signal 0: iptables v1.4.4: 
unknown option `--checksum-fill'
  Try `iptables -h' or 'iptables --help' for more information.

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https://bugs.launchpad.net/bugs/668043

Title:
  libvirt default network doesn't start, iptables errors, bad rules

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