For one, KVM virtualization does not run on Illumos, nor Solaris.
Second, Oracle is encumbering Solaris with a not-nice license. I haven't followed the latest developments because I no longer care, since I will never use a non-free OS.
Whether you meant to ask, "Why Illumos over Solaris" or "Why SmartOS or OmniOS over Illumos?" I think I have answered your question :-)