[zheng]

Not sure why this is being downvoted, it's actually a good question. If all of your VM's are idle, you would want your host CPU to idle as well, although my guess is this doesn't happen in things like Xen, VMWare, etc.

[vegardx]

There has actually been problems with that, there was a bug with Citrix XenServer [0] where the CPU would, if left on idle for a long time, step down and turn off more or less all cores, which resulted in a locked up and unresponsive host. You can imagine what that did to the virtual machine supposedly running on that host.

[0] http://support.citrix.com/article/CTX127395