LXD Limitations

In recent versions of Ubuntu lxd runs as a snap.
Snaps are a very good way of getting an application installed with little or no configuration.

There is one limitation regarding the HOME directory of a user described here.
In particular -
> The $HOME directory of the user must match /home/user. Other directories are not supported yet. In particular /home/subdir/user is also not supported.

We use Samba to join Ubuntu servers to an AD domain.
When logging on to a Linux server this results in a home directory similar to: /home/DOMAIN/user.
Lxc will not work for these AD authenticated accounts, returning this error:

cannot create user data directory: /home/DOMAIN/user/snap/lxd/12631: Permission denied

which is very odd because the complete set of snap directories do get created:

user@srv03:~/snap/lxd$ ls -l
total 8
drwxr-xr-x 2 user domain users 4096 Dec 18 12:55 12631
drwxr-xr-x 2 user domain users 4096 Dec 18 12:55 common
lrwxrwxrwx 1 user domain users    5 Dec 18 12:55 current -> 12631