Not sure what in the announcement you are referring to. The only thing it says about Docker is that it has brought move visibility to OS-virtualization.

But, Joyent is infact working on docker support for SmartOS. They have revived an old Solaris feature called LX-branded zones that allows running linux binaries directly in SmartOS. Bryan Cantrill gave a talk on it at SurgeConf this year:

video: https://www.youtube.com/watch?v=TrfD3pC0VSs slides: http://www.slideshare.net/bcantrill/illumos-lx

Sorry if anything was unclear -- while OS-based virtualization is very core to SDC, there's nothing specific to Docker at the moment. That said, that's definitely trying to make SDC a good fit for production Docker deployments -- and if you want a sneak peek as to some of the technological underpinnings, see our work on LX branded zones in SmartOS.[1] Expect a lot more there in the coming weeks and months; all of our work there has been (and will be!) done in the open.

[1] http://www.slideshare.net/bcantrill/illumos-lx

Cool. Are there any links to the project source for the LX branded zones work?

Yes, sorry -- it's all open, and lives in SmartOS, which doesn't necessarily have the most intuitive repo name:

http://github.com/joyent/illumos-joyent

If you look at the commit log, you'll see this is a very active area of development. Also, you can find us in #smartos on Freenode if you have specific questions.

These are Solaris containers / zones, which as you pointed out can host a full KVM Linux (which can in turn host docker containers).

Someday docker may be extended to support Solaris natively, the same way Microsoft has committed to adding support for Windows.