tljh is specifically a distribution of JupyterHub that uses systemd meant for running in a cloud VM. If you run it in a container, you have to make sure you’ve set up systemd to run multiple services in a single container, which is not really “the container way.” It’s definitely possible, but it’s not supported in that if you have issues with this configuration, we can’t really help, and documenting setting up systemd in a container is not something we’re going to do. If it works fine for you, then there’s no problem.
As for using docker in production, I’m not quite sure what you are referring to, but it’s definitely fine to use JupyterHub with docker in production and this is very common. It’s just not what tljh is for. Usually you’d use something like docker-compose for this, to put the Hub, proxy (maybe even database), and each user in their own container via DockerSpawner.