I had this same issue, but I tried so many things that I am not sure what made the difference. Going in reverse of what I did to get a working solution.
1) In the KVM host, I changed the Video from "QXL" --> "VGA" (worked after this)
2) Updated ~/.config/monitors.xml with:
<monitors version="1">
<configuration>
<clone>no</clone>
<output name="Virtual-0">
<vendor>unknown</vendor>
<product>unknown</product>
<serial>unknown</serial>
<width>1440</width>
<height>900</height>
<rate>59.990913391113281</rate>
<x>0</x>
<y>0</y>
<rotation>normal</rotation>
<reflect_x>no</reflect_x>
<reflect_y>no</reflect_y>
<primary>yes</primary>
<presentation>no</presentation>
<underscanning>no</underscanning>
</output>
</configuration>
<configuration>
<clone>no</clone>
<output name="Virtual-0">
<vendor>???</vendor>
<product>0x0000</product>
<serial>0x00000000</serial>
<width>1440</width>
<height>900</height>
<rate>60</rate>
<x>0</x>
<y>0</y>
<rotation>normal</rotation>
<reflect_x>no</reflect_x>
<reflect_y>no</reflect_y>
<primary>yes</primary>
<presentation>no</presentation>
<underscanning>no</underscanning>
</output>
</configuration>
</monitors>
3) Updated /etc/default/grub adding: "GRUB_GFXMODE=1440x900" and then running "sudo update-grub"
4) Using advice from this post ( Reinstall package and its installed dependencies) to reinstall Gnome:
sudo apt-cache depends gnome | grep '[ |]Depends: [^<]' | cut -d: -f2 | tr -d ' ' | xargs sudo apt-get --reinstall install -y
Hope this helps!