Comment # 1 on bug 907324 from James Fehlig

Looks like virtinst-set-cache-mode-unsafe-for-install.patch is not quite smart
enough to handle block devices.  From set_defaults() in virtinst/devicedisk.py

  # Enable cache=none and io=native for block devices. Would
  # be nice if qemu did this for us but that time has long passed.
  if not self.driver_cache:
      self.driver_cache = self.CACHE_MODE_NONE
  if not self.driver_io:
      self.driver_io = self.IO_MODE_NATIVE

And if I understand the code correctly,
virtinst-set-cache-mode-unsafe-for-install.patch will change the cache mode to
'unsafe' during install phase, which seems to be the cased based on the disk
config in the install XML from the virt-manager log file

    <disk type="block" device="disk">
      <driver name="qemu" type="raw" cache="unsafe" io="native"/>
      <source dev="/dev/storage/openSUSE-Factory"/>
      <target dev="vda" bus="virtio"/>
    </disk>

Unfortunately, as noted in the error, io='native' is only compatible with
cache='none' or cache='directsync'.

Passing to Charles to take a look...