Salt minion inside docker container?

You can do either or both. The two options have different purposes. Here's different ways you could use configuration management:

Salt for building an image

Rather than writing a more complex Dockerfile to install and set up your code, your Dockerfile just says something like

FROM saltstack/ubuntu-14.04RUN salt-call <...>

This might be good if you're looking at transitioning from Salt-provisioned machines into using containers. Ultimately, I've preferred to use the Dockerfile and not a config manager here because it's more transparent and I can take advantage of caching when I'm building the image during development.

Salt minion inside an image

There's two different philosophies with Docker. One is that you use a container like a sand-boxed application: one application per container and generally restrict inter-application communication to TCP. The other is that you treat containers like little machines, provisioning multiple applications on one container and run some initd-type service inside the container to keep them all running.

If you follow the latter style and want to update a running container, a minion inside the container is how to do it. (Personally, I prefer doing the former and rebuilding/restarting containers when I want to change anything.)

Salt minion on the host machine

Finally, you might want configuration management on the host-machine to manage the containers (pulling, starting, stopping, and restarting). This would feel most familiar to you if you've done configuration management before, but there's a lot less configuration to manage because the dependencies and other application-specific configuration are all packed up into their containers.