I had this error on 12.04 when I was booted in the xen hypervisor.  I
added this to my .bashrc:

export VIRSH_DEFAULT_CONNECT_URI=”xen:///”

The problem was then resolved.  I found the information here:
https://sanifool.wordpress.com/2012/05/25/installation-of-libvirt-on-xen-for-ubuntu/

I hope this helps others

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https://bugs.launchpad.net/bugs/920853

Title:
  Virt-manager will exit with error 'internal error Cannot find suitable
  emulator for x86_64'

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