Hi!
There is a discussion in the comments of the post at https://blog.simos.info/how-to-use-lxd-container-hostnames-on-the-host-in-ubuntu-18-04/ Have you looked at those?
I noticed that in your /etc/resolv.conf you have added the DNS servers of your cloud provider and LXD’s dnsmasq server. And then there is the caching server of systemd. That setup does not fuse all these together. You would need to keep just the 127.0.0.53 DNS server and then let systemd-resolved to fuse it for you.