Description

Azure VMs deployed from alpha 3794.0.0 end up with a configured hostname of 'localhost' when deployed with the default params (no user provided ignition file). It appears to be connected with the update to waagent 2.9.1.1, and the hostname is set to localhost by oem-cloudinit.service.

Impact

Probably breaks all sorts of things. Surprising that kola doesn't catch this (is ignition used in all tests?).

Environment and steps to reproduce

1. Set-up: az vm create -n flatcar-vm-2 -g $g -size Standard_E8bds_v5 --image kinvolk:flatcar-container-linux-free:alpha-gen2:latest --admin-username azureuser --disk-controller-type nvme --security-type standard
2. Task: check hostname
3. Action(s): ssh <ip> hostname
4. Error: localhost

Expected behavior

VM hostname should be the same as instance id (here flatcar-vm-2).

Additional information

Please add any information here that does not fit the above format.