See $URL and bug 235770.
This bug should have been filed as UNCONFIRMED. I'm unable to find the offending file in xen-tools and I'm unable to emerge xen itself (sed: -e expression #6, char 930: unterminated `s' command). Might be related to the fact that I emerged it with --nodeps. rbu, can you check? You're maintainer anyway :p
The xen-tools package contains the file ( /tools/ioemu/target-i386-dm/qemu-dm.debug ), and that indeed creates those files insecurely. However, neither the Makefiles not the ebuilds install this file.
*** Bug 246068 has been marked as a duplicate of this bug. ***