> it looks like the free version can be used in production

I think you might be confusing vault with another product?

We self-host vault in production, and it doesn't cost us a dime.

(other than the engineers we pay internally to operate it, of course)

Err what? Vault can absolutely be used in production for free. If you want the enterprise features, then you pay.

Why can't the free version of Vault be used in production?

Production-worthiness depends on your needs. The free edition is perfectly good for most people, however there are several features and modules that are only available in the Enterprise Edition. Notably, some of the disaster recovery, scaleout, and multifactor authentication features cost extra.

ref: https://www.hashicorp.com/products/vault/pricing

I think the problem was that auto-unseal wasn't free (it is now, so kudos to HashiCorp for listening).