A blog article at http://hyperthese.net/post/kvmized-debian-on-lvm/ suggests that you create LVM logical volumes on the host (physical server) and create filesystems directly on them, without creating partitions, and before creating the virtual machines.
I tried it out, and long story short: seemed to work, and I was able to enlarge an LV and the filesystem on it.
Here's the long story, i.e. what I did:
Created LVM logical volumes for root, var and swap for the VM, on the host (running Ubuntu 10.04):
me@host:~$ sudo lvcreate -L4G -n test-root vg1
me@host:~$ sudo lvcreate -L20G -n test-var vg1
me@host:~$ sudo lvcreate -L2G -n test-swap vg1
Created file systems and swap on LVs:
me@host:~$ sudo mkfs.ext3 /dev/mapper/vg1-test--root
me@host:~$ sudo mkfs.ext3 /dev/mapper/vg1-test--var
me@host:~$ sudo mkswap -f /dev/mapper/vg1-test--swap
Created the VM:
me@host:~$ sudo virt-install --name=test --ram=2048 --os-type=linux --os-variant=ubuntulucid --cdrom=ubuntu-server-10.04-lts-64bit.iso --disk path=/dev/mapper/vg1-test--root --disk path=/dev/mapper/vg1-test--var --disk path=/dev/mapper/vg1-test--swap --network bridge=br0 --vnc --noautoconsole
Then I connected to the new VM using virt-viewer and the Ubuntu installer was there waiting. I chose the mode 'Install a minimal virtual machine' (F4 key).
At the partitioning phase I chose the manual partitioning. The installer found virtual disks vda, vdb and vdc and recognized the first two having ext3 and last as swap. I chose the ext3 partitions and told to use them as ext3 partitions (the default was "do not use"), with "no, keep the existing data" and mount point as / for the first one and /var for the second one. Swap was set up correctly by default. Then I chose to install grub on the first disk.
I got the VM up and running fine. Fdisk shows vda as having an empty partition table and vdb and vdc as not having a valid partition table. I don't know if having or not having a partitioning table is a problem, there's some discussion about it at http://unix.stackexchange.com/questions/5162/how-to-install-grub-to-a-whole-ext4-disk-without-partition-table .
Finally I tried resizing the var disk. First, on the host:
me@host:~$ sudo lvextend -L24G /dev/vg1/test-var
Then I rebooted the VM and resized the file system on the VM:
me@test:~$ sudo resize2fs /dev/vdb
And it resized it fine.
I don't know if this is a good way to do it or not, but so far it seems to work. Any comments?