OK... perhaps there are a number of things going on here.
I changed the adapter NIC for the new host to be E1000 and did not connect the second NIC on power up.
By checking the guest propertise, I compare the MAC address to these DHCP scope leases and could test by ping the IP that was release to it.
When it doesn't ping... it's not gonna clone.
The Physical linux server also has 2 NIS and originally I left them both in.
It also appeared to work after having two nics but leaving the second one set to Not connect on boot.
With only one... it works so I'm sure it's getting confused at this stage..
One thing to note... when it does work and connect to the network correctly... and the converter begins to progress... the guest console will continue to displace the prompt to login.
So make sure you check the progress of the converter when testing.
Hope this helps.