Indeed switching to hardy bochsbios fixed the problem for me. I'm now using 
gutsy qemu and hardy bochsbios. I installed bochsbios using:
sudo wget 
http://archive.ubuntu.com/ubuntu/pool/universe/b/bochs/bochsbios_2.3+20070705-2ubuntu1_all.deb
sudo dpkg -i bochsbios_2.3+20070705-2ubuntu1_all.deb

-- 
Qemu VM fails during startup - Gutsy
https://bugs.launchpad.net/bugs/154960
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