Did you ever get sshuttle ported to FreeBSD?
Yes - we just got pull requests into sshuttle as well as some patches to FreeBSD to make ipfw and UDP tunneling work the right way ... I am testing it now (Feb 2017) and will post to -hackers when it is done ...
The very first VPS[1] provider, JohnCompanies, was built entirely on jail (and FreeBSD 4.x).
At the peak we had over a thousand FreeBSD jails running for customers all over the world.
In the end, fancy provisioning and fine-grained resource tuning (with products like Virtuozzo) won out. Although JC is still operating and still provides jail-based VPS.
The offsite backup infrastructure that was built for JC customers became a standalone company in 2006 and was named "rsync.net".
[1] The term "VPS" had not been coined in mid-2001 so I made up the term "server instance" which didn't stick.