Seems to me like post-install the system is doing what is expected, in
bringing up the networking according to /etc/network/interfaces.

I'm reassigning this to netcfg, which is the culprit for not copying the
installer config back to the installed system:

Mar 11 07:56:39 netcfg[12768]: DEBUG: No interface given; clearing 
/etc/network/interfaces
Mar 11 07:56:39 netcfg[12768]: DEBUG: Writing informative header
Mar 11 07:56:39 netcfg[12768]: DEBUG: Success!
Mar 11 07:56:39 netcfg[12768]: DEBUG: Writing loopback interface
Mar 11 07:56:39 netcfg[12768]: DEBUG: Success!
Mar 11 07:56:39 netcfg[12768]: DEBUG: Writing SLAAC stanza for eth0
Mar 11 07:56:39 netcfg[12768]: DEBUG: Success!

Was there another prompt down the line asking for information about some
network interface?

** Package changed: debian-installer (Ubuntu) => netcfg (Ubuntu)

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https://bugs.launchpad.net/bugs/1556177

Title:
  After Ubuntu16.04 VM installation on brazos LPAR, Network does not
  come up

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