One thing that most people don't realize with virtualization is that its not the actual virtualization layer that is important. It works, they all do. The important part is in the management tools and that's something that's been sorely missing from the Open Source arena for too long.
In a former life, I and some others evaluated many of the different virtualization offerings that were available. Being the OSS advocate I am, I always pushed Xen. When we got in to a room with sales people and managers though, I didn't have much of an argument. It's because of the management tools. VMWare, Virtual Iron, and others always had great management tools, pretty graphs, useful trending and all the bells and whistles needed to have a manager fork over some cash.
The bells and whistles were great and all but there was actual value to the underlying management software. Ease of storage management and network configuration is just not something that you get in a multi-thousand node environment using only xen and some scripting.
Thankfully oVirt is about to change a lot of that. oVirt takes other tool sets and combines them into a single useful solution. Right now it's still in the early stages but it's ripe for testing. On the back end it is using a lot of the libvirt libraries. Libvirt basically takes all the important bits of each virtualization technology and abstracts them. For example, kvm and xen have different applications admins typically run to use them. Libvirt allows one to use kvm, or xen, or whatever, all with the same libraries and command parameters. That's why the virtualization technology you're currently using doesn't really matter. It's the management bits that matter.
oVirt currently only supports hardware kvm. I think it has enough momentum now that it will be a leading technology in about 2 years in the virtualization management arena. It's built on free open source software and the current appliance demo is based on Fedora. I'd expect tighter integration with the actual OS pretty soon via an official respin of Fedora or just installable via yum instead of in image form.
If you're a fairly tech savvy individual who likes early adoption, download ovirt and get to the bug reporting. It's at that point where it can still be changed quite a bit but is usable so you can more easily make your own changes, patches, etc. Getting involved this early in the process will only help and make the package better more quickly. We'll be adopting it in Fedora's Infrastructure soon I suspect and I'm already in touch with many of the developers to see how we can help. If you use virtualization much and would like an OSS solution, I'd suggest you do the same.