> Packaging your app for running in production, `pip freeze > requirements.txt` and `pip install -r requirements.txt` is the "official solution", it works well enough.

It doesn't though. The default format for requirements doesn't specify which requirements are top-level and which are not. Updating dependencies on a project that doesn't have this distinction is complete pain. It also doesn't work when "production" might mean different environments with different Python versions.

> Packaging a lib for public distribution, setuptools... I don't have enough experience there but not many people need to actually use it.

Actually, using setuptools and setup.py (or a modern equivalent) is very helpful for packaging scripts and commands, defining top-level dependencies or other things. It's much easier to distribute a wheel file to production than a full repository.