No Screens Found error flagged when starting an xorg session

Kernel: Arch Linux 5.8.1 (virtualized)
CPU:9th gen core i7, 6 cores 12 threads
GPU:RTX 2070M.

Hello, I’m having some issues with the NVIDIA drivers not recognizing my display (VIRTUAL1) causing xorg to crash when said drivers are initialized. This is not an issue with my environment as when no xorg.conf file is included, xorg boots fine using compute display drivers. The latest Nvidia, Nvidia-settings, and Nvidia-utils packages are also installed provided by the the official arch repository.

I am using kernel 5.8.1 within a KVM virtualized environment with the entirety of IOMMU group 1 passed into the client side. The virtual display is using the QEMU QXL device as well as a display spice server. Other display drivers work just fine recognizing the virtual display and outputting to it so im suspecting that this issue is driver-side.

The nvidia-smi command returns “unable to determine the device handle for GPU 0000:07:00.0: Unknown Error”

side note: nvidia_xconfig produces the same error as the config files listed below.
My xorg.conf looks like this:

Section “Module”
Load “modesetting”
Section “Device”
Identifier “nvidia”
Driver “nvidia”
BusID “(PCI:7:0:0)”
Option “AllowEmptyInitialConfiguration”

With my .xinitrc file showing:

xrandr --setprovideroutputsource modesetting NVIDIA-0
xrandr --auto

The relevant pcie devices on the client side displayed via lspci show:

07:00:0 VGA compatible controller: NVIDIA Corporation TU106M [GeForce RTX 2070 Mobile] (rev a1)
08:00:0 Audio device: NVIDIA Corporation TU106 High Definition Audio Controller (rev a1)
09:00:0 USB controller: NVIDIA Corporation TU106 USB 3.1 Host Controller (rev a1)
0a:00:0 Serial bus controller [0c80]: NVIDIA Corporation TU106 USB Type-C UCSI Controller (rev a1)

Any and and all ideas regarding the problem are welcome.

Here are the nvidia and xorg log files since I cant seem to edit my post.

Xorg.0.log (5.8 KB) standard xorg log
nvidia-bug-report.log.gz (68.5 KB) nvidia bug report taken when xorg session is not is use
nvidia-bug-report.log.old.gz (68.9 KB) nvidia bug report taken with xorg session in use (xorg not using nvidia driver)

Thank you in advance for any help.