Does developer edition salesforce org's run in production environments?

Developer developer Edition orgs run on production instances. There are multiple differences between the Developer Edition org and production, mainly around governor limits but potentially also including the slate of enabled features and licenses. A Developer Edition org has no relationship with a production org and should not be expected to match a production org's shape. Developer sandboxes run on sandbox instances. As everyone is aware, they do come with differences from production, such as data and file storage space, but in other respects such as features and licenses are designed to match production as a Developer Edition org will not. Hope this helps you in understanding the salesforce developer edition!