How mature and featureful is LVM RAID?
LVM-RAID is actually mdraid under the covers. It basically works by creating two logical volumes per RAID device (one for data, called "rimage"; one for metadata, called "rmeta"). It then passes those off to the existing mdraid drivers. So things like handling disk read errors, I/O load balancing, etc. should be fairly mature.
That's the good news.
Tools
You can't use mdadm on it (at least, not in any easy way¹) and the LVM RAID tools are nowhere near as mature. For example, in Debian Wheezy, lvs can't tell you RAID5 sync status. I very much doubt repair and recovery (especially from "that should never happen!" situations) is anywhere near as good as mdadm (and I accidentally ran into one of those in my testing, and finally just gave up on recovering it—recovery with mdadm would have been easy).
Especially if you're not using the newest versions of all the tools, it gets worse.
Missing Features
Current versions of LVM-RAID do not support shrinking (lvreduce) a RAID logical volume. Nor do they support changing the number of disks or RAID level (lvconvert gives an error message saying not supported yet). lvextend does work, and can even grow RAID levels that mdraid only recently gained support for, such as RAID10. In my experience, extending LVs is much more common than reducing them, so that's actually reasonable.
Some other mdraid features aren't present, and especially you can't customize all the options you can in with mdadm.
On older versions (as found in, for example, Debian Wheezy), LVM RAID does not support growing, either. For example, on Wheezy:
root@LVM-RAID:~# lvextend -L+1g vg0/root
Extending logical volume root to 11.00 GiB
Internal error: _alloc_init called for non-virtual segment with no disk space.
In general, you don't want to run the Wheezy versions.
The above is once you get it installed. That is not a trivial process either.
Tool problems
Playing with my Jessie VM, I disconnected (virtually) one disk. That worked, the machine stayed running. lvs, though, gave no indication the arrays were degraded. I re-attached the disk, and removed a second. Stayed running (this is raid6). Re-attached, still no indication from lvs. I ran lvconvert --repair on the volume, it told me it was OK. Then I pulled a third disk... and the machine died. Re-inserted it, rebooted, and am now unsure how to fix. mdadm --force --assemble would fix this; neither vgchange nor lvchange appears to have that option (lvchange accepts --force, but it doesn't seem to do anything). Even trying dmsetup to directly feed the mapping table to the kernel, I could not figure out how to recover it.
Also, mdadm is a dedicated tool just for managing RAID. LVM does a lot more, but it feels (and I admit this is pretty subjective) like the RAID functionality has sort of been shoved in there; it doesn't quite fit.
How do you actually install a system with LVM RAID?
Here is a brief outline of getting it installed on Debian Jessie or Wheezy. Jessie is far easier; note if you're going to try this on Wheezy, read the whole thing first…
Use a full CD image to install, not a netinst image.
Proceed as normal, get to disk partitioning, set up your LVM physical volumes. You can put /boot on LVM-RAID (on Jessie, and on Wheezy with some work detailed below).
Create your volume group(s). Leave it in the LVM menu.
First bit of fun—the installer doesn't have the dm-raid.ko module loaded, or even available! So you get to grab it from the linux-image package that will be installed. Switch to a console (e.g., Alt-F2) and:
cd /tmp
dpkg-deb --fsys-tarfile /cdrom/pool/main/l/linux/linux-image-*.deb | tar x
depmod -a -b /tmp
modprobe -d /tmp dm-raid
The installer doesn't know how to create LVM-RAID LVs, so you have to use the command line to do it. Note I didn't do any benchmarking; the stripe size (-I) below is entirely a guess for my VM setup:
lvcreate --type raid5 -i 4 -I 256 -L 10G -n root vg0
On Jessie, you can use RAID10 for swap. On Wheezy, RAID10 isn't supported. So instead you can use two swap partitions, each RAID1. But you must tell it exactly which physical volumes to put them on or it puts both halves of the mirror on the same disk. Yes. Seriously. Anyway, that looks like:
lvcreate --type raid1 -m1 -L 1G -n swap0 vg0 /dev/vda1 /dev/vdb1
lvcreate --type raid1 -m1 -L 1G -n swap1 vg0 /dev/vdc1 /dev/vdd1
Finally, switch back to the installer, and hit 'Finish' in the LVM menu. You'll now be presented with a lot of logical volumes showing. That's the installer not understanding what's going on; ignore everything with rimage or rmeta in their name (see the first paragraph way above for an explanation of what those are).
Go ahead and create filesystems, swap partitions, etc. as normal. Install the base system, etc., until you get to the grub prompt.
On Jessie, grub2 will work if installed to the MBR (or probably with EFI, but I haven't tested that). On Wheezy, install will fail, and the only solution is to backport Jessie's grub2. That is actually fairly easy, it compiles cleanly on Wheezy. Somehow, get your backported grub packages into /target (or do it in a second, after the chroot) then:
chroot /target /bin/bash
mount /sys
dpkg -i grub-pc_*.deb grub-pc-bin_*.deb grub-common_*.deb grub2-common_*.deb
grub-install /dev/vda … grub-install /dev/vdd # for each disk
echo 'dm_raid' >> /etc/initramfs-tools/modules
update-initramfs -kall -u
update-grub # should work, technically not quite tested²
umount /sys
exit
Actually, on my most recent Jessie VM grub-install hung. Switching to F2 and doing while kill $(pidof vgs); do sleep 0.25; done, followed by the same for lvs, got it through grub-install. It appeared to generate a valid config despite that, but just in case I did a chroot /target /bin/bash, made sure /proc and /sys were mounted, and did an update-grub. That time, it completed. I then did a dpkg-reconfigure grub-pc to select installing grub on all the virtual disks' MBRs.
On Wheezy, after doing the above, select 'continue without a bootloader'.
Finish the install. It'll boot. Probably.
Community Knowledge
There are a fair number of people who know about mdadm, and have a lot of deployment experience with it. Google is likely to answer most questions about it you have. You can generally expect a question about it here to get answers, probably within a day.
The same can't be said for LVM RAID. It's hard to find guides. Most Google searches I've run instead find me stuff on using mdadm arrays as PVs. To be honest, this is probably largely because it's newer, and less commonly used. Somewhat, it feels unfair to hold this against it—but if something goes wrong, the much larger existing community around mdadm makes recovering my data more likely.
Conclusion
LVM-RAID is advancing fairly rapidly. On Wheezy, it isn't really usable (at least, without doing backports of LVM and the kernel). Earlier, in 2014, on Debian testing, it felt like an interesting, but unfinished idea. Current testing, basically what will become Jessie, feels like something that you might actually use, if you frequently need to create small slices with different RAID configurations (something that is an administrative nightmare with mdadm).
If your needs are adequately served by a few large mdadm RAID arrays, sliced into partitions using LVM, I'd suggest continuing to use that. If instead you wind up having to create many arrays (or even arrays of logical volumes), consider switching to LVM-RAID instead. But keep good backups.
A lot of the uses of LVM RAID (and even mdadm RAID) are being taken over by things like cluster storage/object systems, ZFS, and btrfs. I recommend also investigating those, they may better meet your needs.
Thank yous
I'd like to thank psusi for getting me to revisit the state of LVM-RAID and update this post.
Footnotes
I suspect you could use device mapper to glue the metadata and data together in such a way that mdadm --assemble will take it. Of course, you could just run mdadm on logical volumes just fine... and that'd be saner.
When doing the Wheezy install, I failed to do this first time, and wound up with no grub config. I had to boot the system by entering all the info at the grub prompt. Once booted, that worked, so I think it'll work just fine from the installer. If you wind up at the grub prompt, here are the magic lines to type:
linux /boot/vmlinuz-3.2.0-4-amd64 root=/dev/mapper/vg0-root
initrd /boot/initrd.image-3.2.0-4-amd64
boot
PS: It's been a while since I actually did the original experiments. I have made my original notes available. Note that I have now done more recent ones, covered in this answer, and not in those notes.
GRUB2 on Debian 9 is definitely able to read from a normal ("linear") LVM2 volume on MD raid1 (metadata v1.2). However I found this only seems to work if you do insmod lvm before insmod mdraid1x.
If I load them in the opposite order, it changes the order of the devices shown by the GRUB ls command (!), but it does not add the lvm devices to the list.
Standard automatic configuration
To get grub-mkconfig (which is the backend for Debian's update-grub) to detect the second Linux instance as suggested on the RAID wiki page, it sufficed to install the os-prober package. (I expect the Debian installer would have installed this package automatically, if it had seen a second OS when it originally installed the boot loader. Particularly if there was a Windows install).
Interestingly, the generated config loaded lvm after mdraid1x. However it also loaded diskfilter before mdraid1x. It also used the hidden lvmid/... path instead of (lvm/...). For the sake of our sanity, let us ignore the latter difference, and imagine that the early diskfilter load is probably what lets this config work :).
I'm not sure where you're expected to learn either of these methods :-/.
Best Answer
Most init systems probably won't expect this situation so they won't be prepared to first assemble LVM, then MD, then LVM again.
If you put LVM below MD you have to be very careful. MD is supposed to be used with physical disks, but with LVs as RAID members you could easily end up with two members sharing the same disks. That is if using MD as a standalone layer, not the raid functionality of LVM itself, in the latter case LVM itself makes sure of this.
If MD members end up sharing disks, a single disk failure will end up killing more than one of your members. Basically you'd be running a pointless RAID without real redundancy.
The question is, what's the point of such a setup? From your graphic alone it seems obvious that the additional LVM layer is superfluous. Just use the disks directly.
Most people who want to change their RAID1 setup to something else entirely just kick out one disk and build the new system on it. You temporarily lose redundancy for this process but you should always have backups anyway, right?
Most other advantages on LVM do not apply to RAID. You don't need LVM below RAID in order to be able to grow or shrink the RAID. MD can do that well enough on its own.