You have to unset these variables because of a long-standing bug in SPICE:
# unset http_proxy # unset https_proxy
You can’t use virt-install’s --cdrom option twice, because virt-install ignores the second use of the option and only adds a single CD-ROM to the guest. Instead, use --disk ...,device=cdrom,bus=ide:
# virt-install --name=w81-virtio --ram=4096 \
--cpu=host --vcpus=2 \
--os-type=windows --os-variant=win8.1 \
--disk /dev/VG/w81-virtio,bus=virtio \
--disk en-gb_windows_8.1_pro_n_vl_with_update_x64_dvd_6050975.iso,device=cdrom,bus=ide \
--disk /usr/share/virtio-win/virtio-win.iso,device=cdrom,bus=ide
During the install you’ll have to select the “Load driver” option and load the right viostor driver from the second CD-ROM (E:).
Even better, you can use a virtio-scsi CD-ROM for the Windows installer image itself — only the virtio-win driver CD needs to be on the IDE bus.
Windows will boot off the installer ISO using BIOS (SeaBIOS) or UEFI (OVMF) services, which both support virtio-scsi. Then Windows realizes at some point that it has no native drivers to continue reading its own installer CD, and it asks for the driver CD. (This happens earlier than asking for a driver CD for the purposes of the installation target hard disk.) Vioscsi is the right folder to select for this.
I think Microsoft got this really right in their Windows 7 and later installers; this way you can install a Windows guest with all “permanent” drives using virtio, only the temporary virtio-win CD has to be on slow IDE. The amount of data installed from there is minimal, and you can remove the drive and even the controller once you’re done.