Xen/KVM host speed vs “clean” kernel speed

I would go with XEN. Two main reasons. First, you can get it installed and configured painlessly by installing OpenSUSE 11, and you get a GUI to administer it as well. But all the technical stuff is still there at the shell prompt so that you can learn the innards of XEN as and when you want to. Second reason is that XEN is the top choice of companies who provide VPS hosting, and if you think that you might someday want to use your knowledge to get a job, XEN is a better bet. If you are thinking of the career enhancing effect, make sure to look at the innards of XEN, the network virtualization on Linux (which is not part of XEN but useful for building testbeds of routed VMs) and the XEN api. There are various XEN management packages which take care of management for you, but in specialised scenarios, it is always good to be able to write some scripts (probably in Python) to do your own management/monitoring/reporting.

XEN meets all your bullet points and has been around for longer which is why it is the choice of hosting folks.

Note that you might want to also check out OpenVZ which is completely different from XEN but also gets used a lot by VPS hosting companies. Since OpenVZ uses a container model of virtualisation, you can actually run OpenVZ inside a XEN guest.

While you are doing this, think about your disk storage. You probably want volume management, which is also included in OpenSUSE with a nice GUI, so that you can assign hard disk partitions or volumes to the guest OS. For instance, you could even set it up so that a Windows partition can be booted from, or used by the XEN guest.

Red Hat is moving from Xen to KVM. That's certainly swaying my choice for running it under an existing Linux install. On the other hand, there isn't anything like XenServer for KVM.

Converting between the two is possible but not easy.