I am the developer. I am sorry that what am saying is confusing. I will try again and *fingers crossed* it will make sense.
The problem is that you do not know what the terms "development environment" and "production environment" mean. This is not your fault, you have just not heard of them before.
"You must have a separate license for each installation of Joomla in a Production environment".
That statement listed above will make sense to most web developers / programmers. For everyone else, here are definitions.
Production Environment - Where an application or system resides that hosts actual / real data (as opposed to test data) or is available on a publicly accessible network or server.
(
http://www.michigan.gov/cybersecurity/0,1607,7-217-34415---,00.html)
The alternative to this is a development environment where it's only intention is to build a site without being viewed by the public. Once you make the site live for public viewing, it is then a production environment. If you have a subdomain (ie. blog.titanadweb.com) that is intended for public viewing and has its own installation of Joomla!, then it needs its own license.
If for some reason, this is still confusing, please let me know. I want to make sure that this makes sense. You can catch me on AIM and Skype as "ChiefGoFor". Actually talking it out may make more sense.
Thanks!
** If anyone else has a better explanation, please feel free to chime in. Thanks!