CentOS - Dec 2014 - CentOS 7 KVM guests no longer get keystrokes after yum update [solved]

Fixed.

I had installed a preview repository from Red Hat for some
not-yet-released libguestfs features (libguestfs-RHEL-7.1-preview).
There were evidently  changes to some release packages
in the updates repository that were incompatible with the
candidate packages in the preview repository cited above.

I disabled the preview repo in /etc/yum.repos.d/..., uninstalled each 
of its packages, and re-installed the relevant packages (libvirt 
qemu-kvm qemu-kvm-tools virt-* spice-gtk spice-gtk-python spice-gtk-tools 
spice-gtk3-vala spice-xpi). 

Lesson learned: When you install 3rd party repositories you 
should reserve time for hand-holding your package management 
system.

-- 
Charles Polisher