Lindsay Lohan is currently serving her house arrest sentence, wearing an ankle monitoring bracelet and lighting up Blu Cigs electronic cigarettes ... and her dad, Michael, thinks it's the perfect place for his 24-year-old daughter to be right now.

Lohan tells our X17 videographer:

    "I'm just wishing the best for her... I think she's going to do well... It's better than jail."


Lilo is now confined to her Venice Beach pad (next door to ex-GF Samantha Ronson) for a 35-day sentence.

Find out what Michael said about his relationship with his ex Dina ... after the jump.