So if I run all of the docker containers on that host, will they consume CPU/cores as needed like if they were being run as normal installed applications on that host OS?
Yes.
CPU
By default, each container’s access to the host machine’s CPU cycles is unlimited. You can set various constraints to limit a given container’s access to the host machine’s CPU cycles.
Will the docker container consume its own process and all of the processing that is contained in it will be stuck to that parent process's CPU core?
Nope.
Docker uses Completely Fair Scheduler for sharing CPU resources among containers. So containers have configurable access to CPU.
How can I specify a docker container to use a number of cores ( 4 for example ). I saw there is a -C flag that can point to a core id, but it appears there is no option to specify the container to pick N cores at random.
It is overconfigurable. There are more cpu options in Docker which you can combine.
--cpus= Specify how much of the available CPU resources a container can use. For instance, if the host machine has two CPUs and you set --cpus="1.5", the container is guaranteed at most one and a half of the CPUs.
--cpuset-cpus Limit the specific CPUs or cores a container can use. A comma-separated list or hyphen-separated range of CPUs a container can use, if you have more than one CPU. The first CPU is numbered 0. A valid value might be 0-3 (to use the first, second, third, and fourth CPU) or 1,3 (to use the second and fourth CPU).
And more...