It's a joke. I just googled Teapot dogs and out of the first twenty entries only two actually referred to Teapot dogs rather than Teapots designed to look like dogs. The first one was about Labradors that are apparently being bred smaller than normal Labs, and they call their kennel Teapot Labs or something to that effect. The second was about Pomeranians and was making fun of teacup dogs by taking pictures of Pom pups in teapots and calling them Teapot dogs.