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QEMU Nested virtual machines

I am trying to build a test environment using qemu and virt-manager on Debian 12, to host a Windows 11 guest running WSL2.

I have managed to install Windows 11 (using swtpm and ovmf to meet the requirements for TPM and UEFI), but when I try to install WSL, the installation itself appears to succeed but when the guest reboots to finish the installation process it boots to the Windows 11 automatic repair screen from which it never recovers.

I assumed that the problem had something to do with the CPU emulation not supporting nested virtualisation, so to check the guest could support nested virtualisation I did a fresh install of Debian 12 on the guest itself, and then installed qemu and virt-manager on the guest and before creating a nested guest machine successfully.

The system requirements for WSL seem a little vague (the FAQ just says nested virtualisation is needed), but obviously something isn’t quite right as even though I can nest QEMU guests WSL2 wont work!

What do I need to do either to the template below, or on the Windows 11 guest to get WSL2 to work – or is my physical host’s processor missing a key feature?

Thank you.

Debian 12 installs the following versions of the software.

gir1.2-libvirt-glib-1.0:amd64        4.0.0-2
ipxe-qemu                            1.0.0+git-20190125.36a4c85-5.1
libvirt-clients                      9.0.0-4
libvirt-daemon                       9.0.0-4
libvirt-daemon-config-network        9.0.0-4
libvirt-daemon-config-nwfilter       9.0.0-4
libvirt-daemon-driver-qemu           9.0.0-4
libvirt-daemon-system                9.0.0-4
libvirt-daemon-system-systemd        9.0.0-4
libvirt-glib-1.0-0:amd64             4.0.0-2
libvirt0:amd64                       9.0.0-4
ovmf                                 2022.11-6
python3-libvirt                      9.0.0-1
qemu-system-common                   1:7.2+dfsg-7+deb12u2
qemu-system-data                     1:7.2+dfsg-7+deb12u2
qemu-system-x86                      1:7.2+dfsg-7+deb12u2
qemu-utils                           1:7.2+dfsg-7+deb12u2
swtpm                                0.7.1-1.3
swtpm-libs:amd64                     0.7.1-1.3
swtpm-tools                          0.7.1-1.3
virt-manager                         1:4.1.0-2
virtinst                             1:4.1.0-2

My guest machine was defined using the following XML template.

<domain type='kvm'>
<name>guest</name>
<uuid>68171bfe-29f3-4e19-93b6-00b8d9501469</uuid>
<metadata>
<libosinfo:libosinfo xmlns:libosinfo="http://libosinfo.org/xmlns/libvirt/domain/1.0">
<libosinfo:os id="http://microsoft.com/win/11"/>
</libosinfo:libosinfo>
</metadata>
<memory unit='KiB'>4194304</memory>
<currentMemory unit='KiB'>4194304</currentMemory>
<vcpu placement='static'>2</vcpu>
<os firmware='efi'>
<type arch='x86_64' machine='pc-q35-7.2'>hvm</type>
<boot dev='hd'/>
<bootmenu enable='no'/>
</os>
<features>
<acpi/>
<apic/>
<hyperv mode='custom'>
<relaxed state='on'/>
<vapic state='on'/>
<spinlocks state='on' retries='8191'/>
</hyperv>
<vmport state='off'/>
</features>
<cpu mode='host-passthrough' check='none' migratable='on'/>
<clock offset='localtime'>
<timer name='rtc' tickpolicy='catchup'/>
<timer name='pit' tickpolicy='delay'/>
<timer name='hpet' present='no'/>
<timer name='hypervclock' present='yes'/>
</clock>
<on_poweroff>destroy</on_poweroff>
<on_reboot>restart</on_reboot>
<on_crash>destroy</on_crash>
<pm>
<suspend-to-mem enabled='no'/>
<suspend-to-disk enabled='no'/>
</pm>
<devices>
<emulator>/usr/bin/qemu-system-x86_64</emulator>
<disk type='file' device='disk'>
<driver name='qemu' type='qcow2'/>
<source file='/home/.../disk1.qcow2'/>
<target dev='sda' bus='sata'/>
<address type='drive' controller='0' bus='0' target='0' unit='0'/>
</disk>
<disk type='file' device='cdrom'>
<driver name='qemu' type='raw'/>
<target dev='sdb' bus='sata'/>
<readonly/>
<address type='drive' controller='0' bus='0' target='0' unit='1'/>
</disk>
<controller type='usb' index='0' model='qemu-xhci' ports='15'>
<address type='pci' domain='0x0000' bus='0x02' slot='0x00' function='0x0'/>
</controller>
<controller type='pci' index='0' model='pcie-root'/>
<controller type='pci' index='1' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='1' port='0x10'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x0' multifunction='on'/>
</controller>
<controller type='pci' index='2' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='2' port='0x11'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x1'/>
</controller>
<controller type='pci' index='3' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='3' port='0x12'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x2'/>
</controller>
<controller type='pci' index='4' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='4' port='0x13'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x3'/>
</controller>
<controller type='pci' index='5' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='5' port='0x14'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x4'/>
</controller>
<controller type='pci' index='6' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='6' port='0x15'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x5'/>
</controller>
<controller type='pci' index='7' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='7' port='0x16'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x6'/>
</controller>
<controller type='pci' index='8' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='8' port='0x17'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x02' function='0x7'/>
</controller>
<controller type='pci' index='9' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='9' port='0x18'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x03' function='0x0' multifunction='on'/>
</controller>
<controller type='pci' index='10' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='10' port='0x19'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x03' function='0x1'/>
</controller>
<controller type='pci' index='11' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='11' port='0x1a'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x03' function='0x2'/>
</controller>
<controller type='pci' index='12' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='12' port='0x1b'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x03' function='0x3'/>
</controller>
<controller type='pci' index='13' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='13' port='0x1c'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x03' function='0x4'/>
</controller>
<controller type='pci' index='14' model='pcie-root-port'>
<model name='pcie-root-port'/>
<target chassis='14' port='0x1d'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x03' function='0x5'/>
</controller>
<controller type='sata' index='0'>
<address type='pci' domain='0x0000' bus='0x00' slot='0x1f' function='0x2'/>
</controller>
<controller type='virtio-serial' index='0'>
<address type='pci' domain='0x0000' bus='0x03' slot='0x00' function='0x0'/>
</controller>
<interface type='bridge'>
<mac address='52:54:00:fe:66:8e'/>
<source bridge='br0'/>
<model type='e1000e'/>
<link state='up'/>
<address type='pci' domain='0x0000' bus='0x01' slot='0x00' function='0x0'/>
</interface>
<serial type='pty'>
<target type='isa-serial' port='0'>
<model name='isa-serial'/>
</target>
</serial>
<console type='pty'>
<target type='serial' port='0'/>
</console>
<channel type='spicevmc'>
<target type='virtio' name='com.redhat.spice.0'/>
<address type='virtio-serial' controller='0' bus='0' port='1'/>
</channel>
<input type='tablet' bus='usb'>
<address type='usb' bus='0' port='1'/>
</input>
<input type='mouse' bus='ps2'/>
<input type='keyboard' bus='ps2'/>
<tpm model='tpm-crb'>
<backend type='emulator' version='2.0'/>
</tpm>
<graphics type='spice' autoport='yes'>
<listen type='address'/>
<image compression='off'/>
</graphics>
<sound model='ich9'>
<address type='pci' domain='0x0000' bus='0x00' slot='0x1b' function='0x0'/>
</sound>
<audio id='1' type='spice'/>
<video>
<model type='qxl' ram='65536' vram='65536' vgamem='16384' heads='1' primary='yes'/>
<address type='pci' domain='0x0000' bus='0x00' slot='0x01' function='0x0'/>
</video>
<redirdev bus='usb' type='spicevmc'>
<address type='usb' bus='0' port='2'/>
</redirdev>
<redirdev bus='usb' type='spicevmc'>
<address type='usb' bus='0' port='3'/>
</redirdev>
<memballoon model='virtio'>
<address type='pci' domain='0x0000' bus='0x04' slot='0x00' function='0x0'/>
</memballoon>
</devices>
</domain>

Cat /proc/cpuinfo gives the following details (first core only) on the physical host;

processor   : 0
vendor_id   : GenuineIntel
cpu family  : 6
model       : 142
model name  : Intel(R) Core(TM) i7-10610U CPU @ 1.80GHz
stepping    : 12
microcode   : 0xf8
cpu MHz     : 400.000
cache size  : 8192 KB
physical id : 0
siblings    : 8
core id     : 0
cpu cores   : 4
apicid      : 0
initial apicid  : 0
fpu     : yes
fpu_exception   : yes
cpuid level : 22
wp      : yes
flags       : fpu vme de pse tsc msr pae mce cx8 apic sep mtrr pge mca cmov pat pse36 clflush dts acpi mmx fxsr sse sse2 ss ht tm pbe syscall nx pdpe1gb rdtscp lm constant_tsc art arch_perfmon pebs bts rep_good nopl xtopology nonstop_tsc cpuid aperfmperf pni pclmulqdq dtes64 monitor ds_cpl vmx smx est tm2 ssse3 sdbg fma cx16 xtpr pdcm pcid sse4_1 sse4_2 x2apic movbe popcnt tsc_deadline_timer aes xsave avx f16c rdrand lahf_lm abm 3dnowprefetch cpuid_fault epb invpcid_single ssbd ibrs ibpb stibp ibrs_enhanced tpr_shadow vnmi flexpriority ept vpid ept_ad fsgsbase tsc_adjust sgx bmi1 avx2 smep bmi2 erms invpcid mpx rdseed adx smap clflushopt intel_pt xsaveopt xsavec xgetbv1 xsaves dtherm ida arat pln pts hwp hwp_notify hwp_act_window hwp_epp md_clear flush_l1d arch_capabilities
vmx flags   : vnmi preemption_timer invvpid ept_x_only ept_ad ept_1gb flexpriority tsc_offset vtpr mtf vapic ept vpid unrestricted_guest ple shadow_vmcs pml ept_mode_based_exec
bugs        : spectre_v1 spectre_v2 spec_store_bypass swapgs taa itlb_multihit srbds mmio_stale_data retbleed eibrs_pbrsb gds
bogomips    : 4599.93
clflush size    : 64
cache_alignment : 64
address sizes   : 39 bits physical, 48 bits virtual
power management:

and the following results on the guest.

processor   : 0
vendor_id   : GenuineIntel
cpu family  : 6
model       : 142
model name  : Intel(R) Core(TM) i7-10610U CPU @ 1.80GHz
stepping    : 12
microcode   : 0xf8
cpu MHz     : 2303.996
cache size  : 16384 KB
physical id : 0
siblings    : 1
core id     : 0
cpu cores   : 1
apicid      : 0
initial apicid  : 0
fpu     : yes
fpu_exception   : yes
cpuid level : 22
wp      : yes
flags       : fpu vme de pse tsc msr pae mce cx8 apic sep mtrr pge mca cmov pat pse36 clflush mmx fxsr sse sse2 ss syscall nx pdpe1gb rdtscp lm constant_tsc arch_perfmon rep_good nopl xtopology cpuid tsc_known_freq pni pclmulqdq vmx ssse3 fma cx16 pdcm pcid sse4_1 sse4_2 x2apic movbe popcnt tsc_deadline_timer aes xsave avx f16c rdrand hypervisor lahf_lm abm 3dnowprefetch cpuid_fault invpcid_single ssbd ibrs ibpb stibp ibrs_enhanced tpr_shadow vnmi flexpriority ept vpid ept_ad fsgsbase tsc_adjust sgx bmi1 avx2 smep bmi2 erms invpcid mpx rdseed adx smap clflushopt xsaveopt xsavec xgetbv1 xsaves arat umip md_clear arch_capabilities
vmx flags   : vnmi preemption_timer invvpid ept_x_only ept_ad ept_1gb flexpriority tsc_offset vtpr mtf vapic ept vpid unrestricted_guest shadow_vmcs pml
bugs        : spectre_v1 spectre_v2 spec_store_bypass swapgs taa srbds mmio_stale_data retbleed eibrs_pbrsb gds
bogomips    : 4607.99
clflush size    : 64
cache_alignment : 64
address sizes   : 39 bits physical, 48 bits virtual
power management: