I use this script to backup my QEMU/KVM/libVirt virtual machines. The script requires KVM 2.1+ since it uses the live blockcommit mode. This means the data in the snapshot disk is rolled back into the original instead of the other way around. Script does NOT handle spaces in paths.

vm-backup.sh

#!/bin/bash

#To exclude a domain, please add to its name "nobackup"
#First shutdown the guest, then use this command: virsh domrename oldname newname.

DATE=`date +%Y-%m-%d.%H:%M:%S`
LOG=/var/log/kvm-backup.$DATE.LOG
BACKUPROOT=/backup


DOMAINS=$(virsh list --all | tail -n +3 | awk '{print $2}')

for DOMAIN in $DOMAINS; do
        echo "-----------WORKER START $DOMAIN-----------" > $LOG
        echo "Starting backup for $DOMAIN on $(date +'%d-%m-%Y %H:%M:%S')"  >> $LOG

        if [[ $DOMAIN == *"nobackup"* ]];then
                echo "Skipping $DOMAIN , because its excluded." > $LOG
                exit 1
        fi

        VMSTATE=`virsh list --all | grep $DOMAIN | awk '{print $3}'`
        if [[ $VMSTATE != "running" ]]; then
                exit 1
        fi

        BACKUPFOLDER=$BACKUPROOT/KVM-BACKUPS/$DOMAIN
        mkdir -p $BACKUPFOLDER
        TARGETS=$(virsh domblklist $DOMAIN --details | grep disk | awk '{print $3}')
        IMAGES=$(virsh domblklist $DOMAIN --details | grep disk | awk '{print $4}')
        DISKSPEC=""
        for TARGET in $TARGETS; do
                DISKSPEC="$DISKSPEC --diskspec $TARGET,snapshot=external"
        done

        virsh snapshot-create-as --domain $DOMAIN --name "backup-$DOMAIN" --no-metadata --atomic --disk-only $DISKSPEC >> $LOG
        if [ $? -ne 0 ]; then
                echo "Failed to create snapshot for $DOMAIN" > $LOG
                exit 1
        fi

        for IMAGE in $IMAGES; do
                NAME=$(basename $IMAGE)
                if test -f "$BACKUPFOLDER/$NAME"; then
                echo "Backup exists, merging only changes to image" > $LOG
                rsync -apvz --inplace $IMAGE $BACKUPFOLDER/$NAME >> $LOG
                else
                echo "Backup does not exist, creating a full sparse copy" > $LOG
                rsync -apvz --sparse $IMAGE $BACKUPFOLDER/$NAME >> $LOG
                fi

        done

        BACKUPIMAGES=$(virsh domblklist $DOMAIN --details | grep disk | awk '{print $4}')
        for TARGET in $TARGETS; do
                virsh blockcommit $DOMAIN $TARGET --active --pivot >> $LOG

                if [ $? -ne 0 ]; then
                        echo "Could not merge changes for disk of $TARGET of $DOMAIN. VM may be in invalid state." > $LOG
                        exit 1
                fi
        done

        for BACKUP in $BACKUPIMAGES; do
                if [[ $BACKUP == *"backup-"* ]];then

                echo "deleted temporary image $BACKUP" > $LOG
                rm -f $BACKUP
                fi
        done

        virsh dumpxml $DOMAIN > $BACKUPFOLDER/$DOMAIN.xml
        echo "-----------WORKER END $DOMAIN-----------" >> $LOG
        echo "Finished backup of $DOMAIN at $(date +'%d-%m-%Y %H:%M:%S')" >> $LOG
done

exit 0

My version uses rsync --sparse and --inplace options, to make the backup proccess 10x faster, only the changes in the qcow2 files are copied and updated to backup destination.
Also it is possible to exclude a guest by changing its name with -nobackup in the end.