2.0 is in production on many sites. It works. I would always start from the latest patch (or an earlier patch and upgrade) as it includes improvements, and in this case security fixes. Or start with an earlier distribution (e.g. if using a site such as GoDaddy or Digital Ocean etc with prebuilt images) and upgrade to the latest patch level before going live.
There is a 2.1 release coming out soon (it is moving into the testing cycle) - we work on multiple strands in parallel (2.1 is not tied to 2.0 patches). Also, a foundational principle of M2 is to make upgrades easier. We are going to do more frequent releases (and patches) going forward. We need to iteratively improve our internal processes to reduce overheads and fix up the quality of patching, but going from 2.0 to 2.1 should not be a big effort. (Being a realist, I would not be surprised if some speed bumps might come up with the first major upgrade using Composer, but improving upgrades and patches is a major focus for M2.) So no reason to not start with 2.0.4 today and migrate to 2.1 when ready.
Note: when 2.1 launches there may be a lag before the extensions catch up. We have it on the books to make a "release candidate" available to extension developers early so they can test before the final release. With 2.1 extension developers can see the code early on GitHub, but its not a full experience with Composer version management etc to test the full end-to-end experience of installation and upgrades. The Magento Marketplace is launching very soon as a part of this experience. Step 1 is get the Marketplace up, then we are going to look towards improving the experience for the ecosystem - this is one of the planned things to do.
But it is not "2.0 does not work in production and 2.1 does". 2.0 does work in production. 2.1 will just be better. And 2.2 will be better after that again. But it will be more about incremental improvement from now on.
