They touched on the interaction of the two at a recent workshop:

http://www.ovirt.org/wp-content/uploads/2011/09/Ovirt-WorkSh...

    The oVirt project is focused specifically on Data Center 
    virtualization management, related technologies and 
    tooling. oVirt brings the richness required by Data Centers 
    to an open-source platform. OpenStack is focused on 
    cloud which requires a minimum around virtualization 
    richness and rather focuses on cloud features.

    In addition oVirt will be an open virtualization management 
    ecosystem, and may use components from OpenStack or 
    any other community project in achieving that goal. 

    OpenStack and oVirt can be seen complementary in the 
    same way OpenStack has VMWare driver support.