Hi,
Your problem looks similar to the one I got on sys-usb not starting. The reason is that my PC has a Intel Core Ultra series 2 processor. Its architecture has two PCI Root Complex and libvirt is not able to manage the second one. The consequence is that when you want to PCI passthrough a device connected to that second PCI Root Complex to any VM like sys-net or sys-usb , it fails with that error.
You can verify this by checking with a lspci -tvnn command: if you are having the same issue as mine, it will display two branches, one starting with0000:00, the other with 0000:80.
The solution is to patch your libvirt packages as described by @Bloged in AiStone X6AR57TY aka TongFang X6 16" Intel High-end Performance - #2 by Bloged.
You can find some information on how you can compile it in Arrow Lake iGPU support - External monitors (USB-C) not working - #4 by Bloged.
Can you please confirm if this is your issue?
Thanks,
Bertrand