diff --git a/openhands/runtime/impl/docker/docker_runtime.py b/openhands/runtime/impl/docker/docker_runtime.py
index 1176b19972..74ac002096 100644
--- a/openhands/runtime/impl/docker/docker_runtime.py
+++ b/openhands/runtime/impl/docker/docker_runtime.py
@@ -374,28 +374,11 @@ class DockerRuntime(ActionExecutionClient):
             )
             self.log('debug', f'Container started. Server url: {self.api_url}')
             self.send_status_message('STATUS$CONTAINER_STARTED')
-        except docker.errors.APIError as e:
-            if '409' in str(e):
-                self.log(
-                    'warning',
-                    f'Container {self.container_name} already exists. Removing...',
-                )
-                stop_all_containers(self.container_name)
-                return self.init_container()
-
-            else:
-                self.log(
-                    'error',
-                    f'Error: Instance {self.container_name} FAILED to start container!\n',
-                )
-                self.log('error', str(e))
-                raise e
         except Exception as e:
             self.log(
                 'error',
                 f'Error: Instance {self.container_name} FAILED to start container!\n',
             )
-            self.log('error', str(e))
             self.close()
             raise e
 
diff --git a/openhands/server/conversation_manager/docker_nested_conversation_manager.py b/openhands/server/conversation_manager/docker_nested_conversation_manager.py
index db6e071389..6349edd7d9 100644
--- a/openhands/server/conversation_manager/docker_nested_conversation_manager.py
+++ b/openhands/server/conversation_manager/docker_nested_conversation_manager.py
@@ -54,6 +54,7 @@ class DockerNestedConversationManager(ConversationManager):
     docker_client: docker.DockerClient = field(default_factory=docker.from_env)
     _conversation_store_class: type[ConversationStore] | None = None
     _starting_conversation_ids: set[str] = field(default_factory=set)
+    _runtime_container_image: str | None = None
 
     async def __aenter__(self):
         # No action is required on startup for this implementation
@@ -155,6 +156,12 @@ class DockerNestedConversationManager(ConversationManager):
         try:
             # Build the runtime container image if it is missing
             await call_sync_from_async(runtime.maybe_build_runtime_container_image)
+            self._runtime_container_image = runtime.runtime_container_image
+
+            # check that the container already exists...
+            if await self._start_existing_container(runtime):
+                self._starting_conversation_ids.discard(sid)
+                return
 
             # initialize the container but dont wait for it to start
             await call_sync_from_async(runtime.init_container)
@@ -172,7 +179,7 @@ class DockerNestedConversationManager(ConversationManager):
             )
 
         except Exception:
-            self._starting_conversation_ids.remove(sid)
+            self._starting_conversation_ids.discard(sid)
             raise
 
     async def _start_conversation(
@@ -262,7 +269,7 @@ class DockerNestedConversationManager(ConversationManager):
                 )
                 assert response.status_code == status.HTTP_200_OK
         finally:
-            self._starting_conversation_ids.remove(sid)
+            self._starting_conversation_ids.discard(sid)
 
     async def send_to_event_stream(self, connection_id: str, data: dict):
         # Not supported - clients should connect directly to the nested server!
@@ -431,6 +438,7 @@ class DockerNestedConversationManager(ConversationManager):
         # We need to be able to specify the nested conversation id within the nested runtime
         env_vars['ALLOW_SET_CONVERSATION_ID'] = '1'
         env_vars['WORKSPACE_BASE'] = f'/workspace'
+        env_vars['SANDBOX_CLOSE_DELAY'] = '0'
 
         # Set up mounted volume for conversation directory within workspace
         # TODO: Check if we are using the standard event store and file store
@@ -442,9 +450,11 @@ class DockerNestedConversationManager(ConversationManager):
         conversation_dir = get_conversation_dir(sid, user_id)
 
         volumes.append(
-            f'{config.file_store_path}/{conversation_dir}:/root/openhands/file_store/{conversation_dir}:rw'
+            f'{config.file_store_path}/{conversation_dir}:/root/.openhands/file_store/{conversation_dir}:rw'
         )
         config.sandbox.volumes = ','.join(volumes)
+        if not config.sandbox.runtime_container_image:
+            config.sandbox.runtime_container_image = self._runtime_container_image
 
         # Currently this eventstream is never used and only exists because one is required in order to create a docker runtime
         event_stream = EventStream(sid, self.file_store, user_id)
@@ -464,6 +474,18 @@ class DockerNestedConversationManager(ConversationManager):
 
         return runtime
 
+    async def _start_existing_container(self, runtime: DockerRuntime) -> bool:
+        try:
+            container = self.docker_client.containers.get(runtime.container_name)
+            if container:
+                status = container.status
+                if status == 'exited':
+                    await call_sync_from_async(container.start())
+                return True
+            return False
+        except docker.errors.NotFound as e:
+            return False
+
 
 def _last_updated_at_key(conversation: ConversationMetadata) -> float:
     last_updated_at = conversation.last_updated_at
diff --git a/openhands/server/conversation_manager/standalone_conversation_manager.py b/openhands/server/conversation_manager/standalone_conversation_manager.py
index 09649c9125..e547f8e5c8 100644
--- a/openhands/server/conversation_manager/standalone_conversation_manager.py
+++ b/openhands/server/conversation_manager/standalone_conversation_manager.py
@@ -154,6 +154,10 @@ class StandaloneConversationManager(ConversationManager):
                         await conversation.disconnect()
                         self._detached_conversations.pop(sid, None)
 
+                # Implies disconnected sandboxes stay open indefinitely
+                if not self.config.sandbox.close_delay:
+                    return
+
                 close_threshold = time.time() - self.config.sandbox.close_delay
                 running_loops = list(self._local_agent_loops_by_sid.items())
                 running_loops.sort(key=lambda item: item[1].last_active_ts)
diff --git a/openhands/server/utils.py b/openhands/server/utils.py
index f977649806..0bdb94050a 100644
--- a/openhands/server/utils.py
+++ b/openhands/server/utils.py
@@ -1,7 +1,7 @@
 from fastapi import Depends, Request
 
 from openhands.server.shared import ConversationStoreImpl, config, conversation_manager
-from openhands.server.user_auth import get_user_auth, get_user_id
+from openhands.server.user_auth import get_user_id
 from openhands.storage.conversation.conversation_store import ConversationStore
 
 
@@ -11,8 +11,7 @@ async def get_conversation_store(request: Request) -> ConversationStore | None:
     )
     if conversation_store:
         return conversation_store
-    user_auth = await get_user_auth(request)
-    user_id = await user_auth.get_user_id()
+    user_id = get_user_id(request)
     conversation_store = await ConversationStoreImpl.get_instance(config, user_id)
     request.state.conversation_store = conversation_store
     return conversation_store