==You are Ready==
Hopefully all that went well. Make sure to reboot if the system update installed a new kernel. Otherwise you should be good to go.
Here is gets a bit complicated again so make sure to follow the steps exactly. But you already know that I'm sure. Most of the work is done for you already with KVM once its installed but as with most software you usually don't want to run with the defaults. After all anybody reading this is definitely a tweaker. Just be careful here because you can blow away everything on this machine. We will be messing with the storage. Specifically we will be adding a "storage pool" to be used by the VM. Obviously we need to set this up before installing the VM.
====Storage Pool Concepts====
If you have used Vmware or Virtual Box or others you probably are familiar with the VM being stored in a big file. Usually its a vmdk or somthing. While these are fine and work well when using this method you sacrifice some performance because of all the layers being presented to the hypervisor. As a matter of fact the biggest problems with VM perforance can be traced back to how the disk is accessed. Simpler is always better and is almost always more direct. KVM offers direct disk access. In other words it is possible to connect directly to a physical disk in the host to install and run the guest. This offers the best performance because well its the most direct and native way to interact with any block device.
What I will try to describe is a fairly advanced concept called LVM (Logical Volume Manager). There are many methods to create a volume group in Linux but as far as I know it is nessasary to use the KVM gui or cli tools to integrate them properly into KVM. I am not going to describe all the details of LVM because its just so much. Just know that it works well and is very well developed. KVM utilizes LVM and has some built in tools to create and use volume groups. KVM calls them storage pools for some reason, probably to make it easier for people migrating from ESX or others. It makes sense but it can get confusing when all these terms are being tossed around.
Please make sure to follow these steps because you can blow away your system. I have a space PC I am using for this so I am not worried about any date.