To KVM or not to KVM

[David Baron <d_baron@012.net.il>]

I have a dual core intel processor with hyperthreading, etc.
Virtualization options are set on in BIOS.

I still get something like "CPU does not have extensions, doing nothing" when 
the KVM driver tries to load.

I am using a stock 2.6.32 kernel from Sid.

How do I activate KVM stuff? Need to compile the kernel with options set?