Based on the doc, it sounds like only should be used for pure DMS environments, but they don't really explain why:
"When you set this variable to ON, each DMS table space container has a file handle opened until the database is deactivated. Query performance might improve because the processing required to open the containers is eliminated. You should use this registry only in pure DMS environments, otherwise performance of queries against SMS table spaces might be affected negatively."
I usually have a dedicated bufferpool for the catalog tablespace that is about 4000 4K pages (or 2000 in 8K pages), so hopefully not too much I/O on containers.
M. A. Feldman
IBM Certified DBA on DB2 for Linux, UNIX, and Windows
IBM Certified DBA on DB2 for z/OS and OS/390