My previous tests were made with local rpm packages released by jenkins jobs for ita translation from master (tried with both 16/08 and 18/08 no other successfull jobs for CentOS 6.x after). 
Now, to verify if this could influence the problem I actually confirmed to get the same error and behavior with pure master tree.
See engine log here:

https://drive.google.com/file/d/0BwoPbcrMv8mvanZwYWR5X2tWRGs/edit?usp=sharing


Instead with current 3.5 repo just tried on the same re-cleaned environment I have:

[ INFO  ] Starting engine service
[ INFO  ] Restarting httpd
[ INFO  ] Restarting nfs services
[ INFO  ] Waiting for VDSM host to become operational. This may take several minutes...
[ INFO  ] The VDSM Host is now operational
[ INFO  ] Stage: Clean up
          Log file is located at /var/log/ovirt-engine/setup/ovirt-engine-setup-20140822150237-13m6av.log
[ INFO  ] Generating answer file '/var/lib/ovirt-engine/setup/answers/20140822150621-setup.conf'
[ INFO  ] Stage: Pre-termination
[ INFO  ] Stage: Termination
[ INFO  ] Execution of setup completed successfully

and
[root@ovirtita setup]# ll /etc/pki/vdsm/keys/
total 8
-rw-------. 1 vdsm kvm   10 Aug 21 10:34 libvirt_password
-r--r-----. 1 vdsm kvm 1679 Aug 22 15:05 vdsmkey.pem

[root@ovirtita ~]# service vdsmd status
VDS daemon server is running

see engine log for 3.5 here:
https://drive.google.com/file/d/0BwoPbcrMv8mvQWg3ZkRTQl9GQ3c/edit?usp=sharing

For both environments I have used:

yum localinstall http://resources.ovirt.org/pub/yum-repo/repo-name.rpm
(where "repo-name" is ovirt-release35 for 3.5 or ovirt-release-master.rpm for master)
yum install ovirt-engine-setup-plugin-allinone
engine-setup

with all default to answers (except for Yes for vdsm and weak password for admin user).
So I think there is some sort of regression between the current 3.5 and 3.6 master for AIO setup...

I'm sure that on 13/08 I successfully used jenkins package for ita (generated on 11th) with master tree as of 13/08 without this failure problems (apart that vdsmd wasn't able to start during engine-setup; I had only 6Gb of ram on the VM and the host went into "Unissigned" state)
so I don't now what happened in the middle...

 Gianluca


------    engine-setup output for master: --------

[root@ovirtita ~]# engine-setup
[ INFO  ] Stage: Initializing
[ INFO  ] Stage: Environment setup
          Configuration files: ['/etc/ovirt-engine-setup.conf.d/10-packaging-aio.conf', '/etc/ovirt-engine-setup.conf.d/10-packaging-jboss.conf', '/etc/ovirt-engine-setup.conf.d/10-packaging.conf']
          Log file: /var/log/ovirt-engine/setup/ovirt-engine-setup-20140822133624-0qjxbv.log
          Version: otopi-1.3.0_master (otopi-1.3.0-0.0.master.20140728.git336a22e.el6)
[ INFO  ] Hardware supports virtualization
[ INFO  ] Stage: Environment packages setup
[ INFO  ] Stage: Programs detection
[ INFO  ] Stage: Environment setup
[ INFO  ] Stage: Environment customization
         
          --== PRODUCT OPTIONS ==--
         
          Configure Engine on this host (Yes, No) [Yes]: 
          Configure WebSocket Proxy on this host (Yes, No) [Yes]: 
         
          --== PACKAGES ==--
         
[ INFO  ] Checking for product updates...
[ INFO  ] No product updates found
         
          --== ALL IN ONE CONFIGURATION ==--
         
          Configure VDSM on this host? (Yes, No) [No]: Yes
          Local storage domain path [/var/lib/images]: 
          Local storage domain name [local_storage]: 
         
          --== NETWORK CONFIGURATION ==--
         
          Setup can automatically configure the firewall on this system.
          Note: automatic configuration of the firewall may overwrite current settings.
          Do you want Setup to configure the firewall? (Yes, No) [Yes]: 
[ INFO  ] iptables will be configured as firewall manager.
          Host fully qualified DNS name of this server [ovirtita.localdomain.local]: 
[WARNING] Failed to resolve ovirtita.localdomain.local using DNS, it can be resolved only locally
         
          --== DATABASE CONFIGURATION ==--
         
          Where is the Engine database located? (Local, Remote) [Local]: 
          Setup can configure the local postgresql server automatically for the engine to run. This may conflict with existing applications.
          Would you like Setup to automatically configure postgresql and create Engine database, or prefer to perform that manually? (Automatic, Manual) [Automatic]: 
         
          --== OVIRT ENGINE CONFIGURATION ==--
         
          Engine admin password: 
          Confirm engine admin password: 
[WARNING] Password is weak: it is based on a dictionary word
          Use weak password? (Yes, No) [No]: Yes
          Application mode (Both, Virt, Gluster) [Both]: 
          Default storage type: (NFS, FC, ISCSI, POSIXFS, GLUSTERFS) [NFS]: 
         
          --== PKI CONFIGURATION ==--
         
          Organization name for certificate [localdomain.local]: 
         
          --== APACHE CONFIGURATION ==--
         
          Setup can configure the default page of the web server to present the application home page. This may conflict with existing applications.
          Do you wish to set the application as the default page of the web server? (Yes, No) [Yes]: 
          Setup can configure apache to use SSL using a certificate issued from the internal CA.
          Do you wish Setup to configure that, or prefer to perform that manually? (Automatic, Manual) [Automatic]: 
         
          --== SYSTEM CONFIGURATION ==--
         
          Configure an NFS share on this server to be used as an ISO Domain? (Yes, No) [Yes]: 
          Local ISO domain path [/var/lib/exports/iso]: 
          Local ISO domain ACL - note that the default will restrict access to ovirtita.localdomain.local only, for security reasons [ovirtita.localdomain.local(rw)]: 
          Local ISO domain name [ISO_DOMAIN]: 
         
          --== MISC CONFIGURATION ==--
         
         
          --== END OF CONFIGURATION ==--
         
[ INFO  ] Stage: Setup validation
[WARNING] Less than 16384MB of memory is available
         
          --== CONFIGURATION PREVIEW ==--
         
          Application mode                        : both
          Update Firewall                         : True
          Host FQDN                               : ovirtita.localdomain.local
          Datacenter storage type                 : nfs
          Firewall manager                        : iptables
          Engine database name                    : engine
          Engine database secured connection      : False
          Engine database host                    : localhost
          Engine database user name               : engine
          Engine database host name validation    : False
          Engine database port                    : 5432
          Engine installation                     : True
          NFS setup                               : True
          PKI organization                        : localdomain.local
          NFS mount point                         : /var/lib/exports/iso
          NFS export ACL                          : ovirtita.localdomain.local(rw)
          Configure VDSM on this host             : True
          Local storage domain directory          : /var/lib/images
          Configure local Engine database         : True
          Set application as default page         : True
          Configure Apache SSL                    : True
          Configure WebSocket Proxy               : True
         
          Please confirm installation settings (OK, Cancel) [OK]: 
[ INFO  ] Stage: Transaction setup
[ INFO  ] Stopping engine service
[ INFO  ] Stopping ovirt-fence-kdump-listener service
[ INFO  ] Stopping websocket-proxy service
[ INFO  ] Stage: Misc configuration
[ INFO  ] Stage: Package installation
[ INFO  ] Stage: Misc configuration
[ INFO  ] Initializing PostgreSQL
[ INFO  ] Creating PostgreSQL 'engine' database
[ INFO  ] Configuring PostgreSQL
[ INFO  ] Creating/refreshing Engine database schema
[ INFO  ] Creating CA
[ INFO  ] Configuring WebSocket Proxy
[ INFO  ] Generating post install configuration file '/etc/ovirt-engine-setup.conf.d/20-setup-ovirt-post.conf'
[ INFO  ] Stage: Transaction commit
[ INFO  ] Stage: Closing up
         
          --== SUMMARY ==--
         
[WARNING] Less than 16384MB of memory is available
          SSH fingerprint: 99:79:48:8B:A8:83:7B:83:CC:5B:D3:6A:C9:B0:49:28
          Internal CA 6E:D4:C3:B8:E9:7E:BC:95:B2:EB:91:CE:7F:E7:54:E0:43:23:EE:18
          Web access is enabled at:
              http://ovirtita.localdomain.local:80/ovirt-engine
              https://ovirtita.localdomain.local:443/ovirt-engine
          Please use the user "admin" and password specified in order to login
         
          --== END OF SUMMARY ==--
         
[ INFO  ] Starting engine service
[ INFO  ] Restarting httpd
[ INFO  ] Restarting nfs services
[ ERROR ] Failed to execute stage 'Closing up': No permission to read file: /etc/pki/vdsm/keys/vdsmkey.pem
[ INFO  ] Stage: Clean up
          Log file is located at /var/log/ovirt-engine/setup/ovirt-engine-setup-20140822133624-0qjxbv.log
[ INFO  ] Generating answer file '/var/lib/ovirt-engine/setup/answers/20140822133918-setup.conf'
[ INFO  ] Stage: Pre-termination
[ INFO  ] Stage: Termination
[ ERROR ] Execution of setup failed




------ engine-setup output for 3.5: -----

[root@ovirtita ~]# engine-setup
[ INFO  ] Stage: Initializing
[ INFO  ] Stage: Environment setup
          Configuration files: ['/etc/ovirt-engine-setup.conf.d/10-packaging-aio.conf', '/etc/ovirt-engine-setup.conf.d/10-packaging-jboss.conf', '/etc/ovirt-engine-setup.conf.d/10-packaging.conf']
          Log file: /var/log/ovirt-engine/setup/ovirt-engine-setup-20140822150237-13m6av.log
          Version: otopi-1.3.0_master (otopi-1.3.0-0.0.master.20140728.git336a22e.el6)
[ INFO  ] Hardware supports virtualization
[ INFO  ] Stage: Environment packages setup
[ INFO  ] Stage: Programs detection
[ INFO  ] Stage: Environment setup
[ INFO  ] Stage: Environment customization
         
          --== PRODUCT OPTIONS ==--
         
          Configure Engine on this host (Yes, No) [Yes]: 
          Configure WebSocket Proxy on this host (Yes, No) [Yes]: 
         
          --== PACKAGES ==--
         
[ INFO  ] Checking for product updates...
[ INFO  ] No product updates found
         
          --== ALL IN ONE CONFIGURATION ==--
         
          Configure VDSM on this host? (Yes, No) [No]: Yes
          Local storage domain path [/var/lib/images]: 
          Local storage domain name [local_storage]: 
         
          --== NETWORK CONFIGURATION ==--
         
          Setup can automatically configure the firewall on this system.
          Note: automatic configuration of the firewall may overwrite current settings.
          Do you want Setup to configure the firewall? (Yes, No) [Yes]: 
[ INFO  ] iptables will be configured as firewall manager.
          Host fully qualified DNS name of this server [ovirtita.localdomain.local]: 
[WARNING] Failed to resolve ovirtita.localdomain.local using DNS, it can be resolved only locally
         
          --== DATABASE CONFIGURATION ==--
         
          Where is the Engine database located? (Local, Remote) [Local]: 
          Setup can configure the local postgresql server automatically for the engine to run. This may conflict with existing applications.
          Would you like Setup to automatically configure postgresql and create Engine database, or prefer to perform that manually? (Automatic, Manual) [Automatic]: 
         
          --== OVIRT ENGINE CONFIGURATION ==--
         
          Engine admin password: 
          Confirm engine admin password: 
[WARNING] Password is weak: it is based on a dictionary word
          Use weak password? (Yes, No) [No]: Yes
          Application mode (Both, Virt, Gluster) [Both]: 
          Default storage type: (NFS, FC, ISCSI, POSIXFS, GLUSTERFS) [NFS]: 
         
          --== PKI CONFIGURATION ==--
         
          Organization name for certificate [localdomain.local]: 
         
          --== APACHE CONFIGURATION ==--
         
          Setup can configure the default page of the web server to present the application home page. This may conflict with existing applications.
          Do you wish to set the application as the default page of the web server? (Yes, No) [Yes]: 
          Setup can configure apache to use SSL using a certificate issued from the internal CA.
          Do you wish Setup to configure that, or prefer to perform that manually? (Automatic, Manual) [Automatic]: 
         
          --== SYSTEM CONFIGURATION ==--
         
          Configure an NFS share on this server to be used as an ISO Domain? (Yes, No) [Yes]: 
          Local ISO domain path [/var/lib/exports/iso]: 
          Local ISO domain ACL - note that the default will restrict access to ovirtita.localdomain.local only, for security reasons [ovirtita.localdomain.local(rw)]: 
          Local ISO domain name [ISO_DOMAIN]: 
         
          --== MISC CONFIGURATION ==--
         
         
          --== END OF CONFIGURATION ==--
         
[ INFO  ] Stage: Setup validation
[WARNING] Less than 16384MB of memory is available
         
          --== CONFIGURATION PREVIEW ==--
         
          Application mode                        : both
          Update Firewall                         : True
          Host FQDN                               : ovirtita.localdomain.local
          Datacenter storage type                 : nfs
          Firewall manager                        : iptables
          Engine database name                    : engine
          Engine database secured connection      : False
          Engine database host                    : localhost
          Engine database user name               : engine
          Engine database host name validation    : False
          Engine database port                    : 5432
          Engine installation                     : True
          NFS setup                               : True
          PKI organization                        : localdomain.local
          NFS mount point                         : /var/lib/exports/iso
          NFS export ACL                          : ovirtita.localdomain.local(rw)
          Configure VDSM on this host             : True
          Local storage domain directory          : /var/lib/images
          Configure local Engine database         : True
          Set application as default page         : True
          Configure Apache SSL                    : True
          Configure WebSocket Proxy               : True
         
          Please confirm installation settings (OK, Cancel) [OK]: 
[ INFO  ] Stage: Transaction setup
[ INFO  ] Stopping engine service
[ INFO  ] Stopping ovirt-fence-kdump-listener service
[ INFO  ] Stopping websocket-proxy service
[ INFO  ] Stage: Misc configuration
[ INFO  ] Stage: Package installation
[ INFO  ] Stage: Misc configuration
[ INFO  ] Initializing PostgreSQL
[ INFO  ] Creating PostgreSQL 'engine' database
[ INFO  ] Configuring PostgreSQL
[ INFO  ] Creating/refreshing Engine database schema
[ INFO  ] Creating CA
[ INFO  ] Configuring WebSocket Proxy
[ INFO  ] Generating post install configuration file '/etc/ovirt-engine-setup.conf.d/20-setup-ovirt-post.conf'
[ INFO  ] Stage: Transaction commit
[ INFO  ] Stage: Closing up
         
          --== SUMMARY ==--
         
[WARNING] Less than 16384MB of memory is available
          SSH fingerprint: 2D:C6:E2:B1:FC:C8:D6:FF:60:C0:26:88:F0:55:69:96
          Internal CA 4F:91:A1:21:E5:F3:08:07:30:13:9E:18:E7:CE:63:8C:71:AC:61:3D
          Web access is enabled at:
              http://ovirtita.localdomain.local:80/ovirt-engine
              https://ovirtita.localdomain.local:443/ovirt-engine
          Please use the user "admin" and password specified in order to login
         
          --== END OF SUMMARY ==--
         
[ INFO  ] Starting engine service
[ INFO  ] Restarting httpd
[ INFO  ] Restarting nfs services
[ INFO  ] Waiting for VDSM host to become operational. This may take several minutes...
[ INFO  ] The VDSM Host is now operational
[ INFO  ] Stage: Clean up
          Log file is located at /var/log/ovirt-engine/setup/ovirt-engine-setup-20140822150237-13m6av.log
[ INFO  ] Generating answer file '/var/lib/ovirt-engine/setup/answers/20140822150621-setup.conf'
[ INFO  ] Stage: Pre-termination
[ INFO  ] Stage: Termination
[ INFO  ] Execution of setup completed successfully

A diff between rpm on the system after install is here:
$ diff rpm_3.6master.txt rpm_3.5.txt
180a181
> gpg-pubkey-fe590cb7-533d77ee
460,464c461,465
< ovirt-engine-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-backend-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-cli-3.6.0.0-1.20140820.gite160c94.el6.noarch
< ovirt-engine-dbscripts-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-extensions-api-impl-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
---
> ovirt-engine-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-backend-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-cli-3.5.0.4-1.20140820.git374a657.el6.noarch
> ovirt-engine-dbscripts-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-extensions-api-impl-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
466,484c467,485
< ovirt-engine-lib-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-restapi-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-sdk-python-3.6.0.0-1.20140820.gitc625968.el6.noarch
< ovirt-engine-setup-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-setup-base-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-setup-plugin-allinone-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-setup-plugin-ovirt-engine-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-setup-plugin-ovirt-engine-common-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-setup-plugin-websocket-proxy-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-tools-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-userportal-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-webadmin-portal-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-engine-websocket-proxy-3.6.0-0.0.master.20140821172440.gitde6660d.el6.noarch
< ovirt-host-deploy-1.3.0-0.0.master.20140821183616.git82dce3c.el6.noarch
< ovirt-host-deploy-java-1.3.0-0.0.master.20140821183616.git82dce3c.el6.noarch
< ovirt-host-deploy-offline-1.3.0-0.0.master.20140821183616.git82dce3c.el6.x86_64
< ovirt-image-uploader-3.6.0-0.0.master.20140808125503.git066ed25.el6.noarch
< ovirt-iso-uploader-3.6.0-0.0.master.20140812133505.gita6b721e.el6.noarch
< ovirt-release-master-001-0.0.master.noarch
---
> ovirt-engine-lib-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-restapi-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-sdk-python-3.5.0.5-1.20140820.gitc47c189.el6.noarch
> ovirt-engine-setup-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-setup-base-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-setup-plugin-allinone-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-setup-plugin-ovirt-engine-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-setup-plugin-ovirt-engine-common-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-setup-plugin-websocket-proxy-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-tools-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-userportal-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-webadmin-portal-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-engine-websocket-proxy-3.5.0-0.0.master.20140821064931.gitb794d66.el6.noarch
> ovirt-host-deploy-1.3.0-0.0.master.20140820115650.git89155f8.el6.noarch
> ovirt-host-deploy-java-1.3.0-0.0.master.20140820115650.git89155f8.el6.noarch
> ovirt-host-deploy-offline-1.3.0-0.0.master.20140820115650.git89155f8.el6.x86_64
> ovirt-image-uploader-3.5.0-0.1.master.20140811110806.git321a491.el6.noarch
> ovirt-iso-uploader-3.5.0-0.1.master.20140812133501.gita818d93.el6.noarch
> ovirt-release35-001-0.4.rc1.noarch
739,746c740,747
< vdsm-4.16.0-231.git7f489da.el6.x86_64
< vdsm-cli-4.16.0-231.git7f489da.el6.noarch
< vdsm-jsonrpc-4.16.0-231.git7f489da.el6.noarch
< vdsm-jsonrpc-java-1.0.3-0.0.master.20140821162323.git93bec39.el6.noarch
< vdsm-python-4.16.0-231.git7f489da.el6.noarch
< vdsm-python-zombiereaper-4.16.0-231.git7f489da.el6.noarch
< vdsm-xmlrpc-4.16.0-231.git7f489da.el6.noarch
< vdsm-yajsonrpc-4.16.0-231.git7f489da.el6.noarch
---
> vdsm-4.16.2-1.gite8cba75.el6.x86_64
> vdsm-cli-4.16.2-1.gite8cba75.el6.noarch
> vdsm-jsonrpc-4.16.2-1.gite8cba75.el6.noarch
> vdsm-jsonrpc-java-1.0.1-0.0.master.20140817113605.git8e0b2b3.el6.noarch
> vdsm-python-4.16.2-1.gite8cba75.el6.x86_64
> vdsm-python-zombiereaper-4.16.2-1.gite8cba75.el6.noarch
> vdsm-xmlrpc-4.16.2-1.gite8cba75.el6.noarch
> vdsm-yajsonrpc-4.16.2-1.gite8cba75.el6.noarch

I also have contents of whole /var/log for both 3.6 and 3.5 environments as after engine-setup ran.