It will try to find the closest safe portal location, so it won’t spawn in lava (if it can) but it’s true that it can spawn in a cavern beneath lava…
The problem with the nether is that the distances are 1/8 of the original. That will make players closer each other and it is likely that someone ends in some other people’s portal. Maybe I could make Nether distances match with the Overworld ones. Would that be a better idea?