Install Fedora 12 domU:
pfexec virt-install -n f12 -r 512 --vcpus=4 -f /dev/zvol/dsk/rpool/f12d0 -b e1000g0 --os-type=linux -p --nographics --os-variant=fedora11 -l http://fedora-12-mirror/fedora/linux/releases/12/Fedora/i386/os/

-n f12 – domU’s name
-r 512 – allocate 512 MB memory
–vcpus=4 – number of virtual CPUs allocated (make sure this number is lower or equal to the number of CPUs available)
-f /dev/zvol/dsk/rpool/f12d0 – ZVOL block device
-b e1000g0 – bridged networking to e1000g0 interface
-p – paravirtualized guest
–os-variant=fedora11 – “hack” until fedora12 OS-Variant will be integrated into xVM
-l http://fedora-12-mirror/fedora/linux/releases/12/Fedora/i386/os/ – replace fedora-12-mirror with a near Fedora 12 mirror, replace i386 with x86_64 for 64-bit domU

After you bring up the network, do a VNC installation.
Until xVM supports ext4 boot, make sure to create an ext3 /boot partition (or just a big ext3 / filesystem)

After installation, start the domU:
pfexec xm start -c f12
You will be presented the pygrub menu, just press Enter to boot.

Log into the domU and change the default timeout=0 to a different value (e.g. 5 seconds) in /boot/grub/grub.conf. Now you can use virsh start / shutdown commands.

To auto-start the guest on host boot:
virsh autostart f12

Tested on OpenSolaris 2010.02 preview snv_127.

Mount the new Boot Environment:
pfexec mkdir /mnt/devel
pfexec beadm mount devel /mnt/devel


Use the dev publisher:
pfexec pkg -R /mnt/devel set-publisher -O http://pkg.opensolaris.org/dev opensolaris.org

Update to the latest bits:
pfexec pkg -R /mnt/devel image-update -v

If everything went fine (after you read the Release Notes), activate the new BE:
pfexec beadm activate devel

Reboot:
pfexec shutdown -y -g1 -i6

Did this remotely. After reboot, system was up and running, including all xVM domU autostarted.