SL(c)5 does support virtual machines far better than SLC4 (where a special kernel was required).

Once you have installed you dom0 with Xen support

# yum install -y  kernel-xen xen

(and perhaps rebooted to run the "xen" kernel - use uname -a to check) and have set up the disk space for the virtual machine (LVM in the example below, see PreparingXenGuestFilesystems), a single (long..) command is sufficient to get your SLC4 machine installation off the ground:

# virt-install -d --paravirt --name=SLC4Xguest \
 --extra-args="ks=http://linuxsoft.cern.ch/aims2server/aims2ks.cgi noipv6 cmdline" \
 --location=http://linuxsoft.cern.ch/cern/slc4X/i386/ --nographics --mac=00:16:3E:X:Y:Z \
 --file=/dev/mapper/vg00-domU2 --ram=256 --os-variant=rhel4

Some notes:

• the --file argument takes either a path to a file or an (existing) logical volume - in this case you need to give the path to the exsiting block device, not some symlink (like those under /dev/vg00/), since the virt-install script will use the file type as input.
• using Kickstart (via the --extra-args argument) is of course optional.. leaving it off results in a traditional manual install.
• adjust other parameters (--ram, --mac) to suit your environment