The 64 bit kernels that apw provided fixed the described issue for me.
Thank you.

To test, I created a kvm image based on the Precise daily from Jan 17.
I ran the script that triggered the problem initially and verified that
the problem still happened (the visual effect being a corrupted screen).
I then installed the provided 64 bit headers and image using dpkg, and
restarted the kvm.  Repeating the script, the problem did not occur.

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https://bugs.launchpad.net/bugs/915941

Title:
  overlayfs does not honor lxc-related permissions

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