Setting up Bind with a Bridged Network on Ubuntu 12.04 LTS

Setting up Bind with a Bridged Network on Ubuntu 12.04 LTS

I have a 64bit Ubuntu server running 12.04 LTS Headless. I have installed and am using a bridged network in support of a VM the server hosts.
I wanted to setup BIND9 for my local lan and followed some very detailed instructions. However when I modified the /etc/network/interfaces file as directed, the KVM failed to load its network interfaces and I began to get the "Waiting for network" boot message. The server would eventually boot, but I could no longer access the VM via the bridged network and BIND was still not setup correctly.
The instructions I followed are here: http://lani78.wordpress.com/2012/07/22/setting-up-a-dns-for-the-local-network-on-the-ubuntu-12-04-precise-pangolin-server/
My /etc/network/interfaces file which works is as follows:
auto lo iface lo inet loopback pre-up /sbin/ethtool -s eth0 speed 1000 duplex full
auto eth0 iface eth0 inet manual
auto br0 iface br0 inet static address 192.168.1.60 netmask 255.255.255.0 network 192.168.1.0 broadcast 192.168.1.255 gateway 192.168.1.1 dns-nameservers 24.25.5.60 24.25.5.61 dns-search nc.rr.com bridge_ports eth0 bridge_fd 9 bridge_hello 2 bridge_maxage 12 bridge_stp off
The changes I made that caused the KVM not to work are as follows:
auto lo iface lo inet loopback pre-up /sbin/ethtool -s eth0 speed 1000 duplex full
auto eth0 iface eth0 inet manual
auto br0 iface br0 inet static address 192.168.1.60 netmask 255.255.255.0 network 192.168.1.0 broadcast 192.168.1.255 gateway 192.168.1.1 dns-nameservers 127.0.0.1 dns-search rp2c.lan dns-domain rp2c.lan bridge_ports eth0 bridge_fd 9 bridge_hello 2 bridge_maxage 12 bridge_stp off
I am not sure what I did wrong. dig reports no errors and I can forward and reverse lookup my local hosts, but I loose the KVM br0 connectivity.
Any assistance would be appreciated.
Robert Porter