Xen 4.1.2 with pygrub gpt patches back ported installed on top of Ubuntu 11.10. Virt-install'ed F16 PV guest. After domain gets created VNC login screen shows up. Mouse should be kept always inside VNC screen. Otherwise , it will disappear.
Start F16 domU via virsh and connection via vncviewer gives working mouse pointer, which looks like "dot" in VNC session, but gets grabbed.
Boris.