the problem with xen network configuration is usually in the config file you build to boot up a xen machine.
for instance if your dom-u's (guest machine's)name is foo then you have a file called foo.cfg under /etc/xen/ (sometimes just foo)
kernel = "/boot/vmlinuz-2.6-xenU"
memory = 128
name = "foo"
vif = [ 'bridge=xenbr0' ]
root = "/dev/sda1 ro"
disk = [ 'phy:/dev/xen1/foo,sda1,w', 'phy:/dev/xen1/foo_swap,sda2,w' ]
that is where you setup the virtual nic and ip addresses.
then when the xen machine boots it will read its own /etc/network/interfaces file as well but do an ifconfig on your host machine to see if you do have xenbr0 available.