LVM, like everything else, is a mixed blessing.
With respect to performance, LVM will hinder you a little bit because it is another layer of abstraction that has to be worked out before bits hit (or can be read from) the disk. In most situations, this performance hit will be practically unmeasurable.
The advantages of LVM include the fact that you can add more storage to existing filesystems without having to move data around. Most people like it for this advantage.
One disadvantage of LVM used in this manner is that if your additional storage spans disks (ie involves more than one disk) you increase the likelyhood that a disk failure will cost you data. If your filesystem spans two disks, and either of them fails, you are probably lost. For most people, this is an acceptable risk due to space-vs-cost reasons (ie if this is really important there will be a budget to do it correctly) -- and because, as they say, backups are good, right?
For me, the single reason to not use LVM is that disaster recovery is not (or at least, was not) well defined. A disk with LVM volumes that had a scrambled OS on it could not trivially be attached to another computer and the data recovered from it; many of the instructions for recovering LVM volumes seemed to include steps like go back in time and run vgcfgbackup, then copy the resulting /etc/lvmconf file to the system hosting your hosed volume. Hopefully things have changed in the three or four years since I last had to look at this, but personally I never use LVM for this reason.
In your case, I would presume that the VMs are going to be relatively small as compared to the host system. This means to me you are more likely to want to expand storage in a VM later; this is best done by adding another virtual disk to the VM and then growing the affected VM filesystems. You don't have the spanning-multiple-disks vulnerability because the virtual disks will quite likely be on the same physical device on the host system.
If the VMs are going to have any importance to you at all, you will be RAID'ing the host system somehow, which will reduce flexibility for growing storage later. So the flexibility of LVM is probably not going to be required.
So I would presume you would not use LVM on the host system, but would install VMs to use LVM.