I've seen the crash too (Core2Duo T6600) and the only way to work around
it for me was to completely remove all of Ubuntu's Xen stuff and install
the latext Xen 3.0.4 from source. Before, it would freeze when starting
the 3rd guest, now I can run as much as I like.

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Dom0 crashes upon start of second DomU
https://launchpad.net/bugs/71348

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