Recreating the container is the correct approach for Docker, in theory due to the way MikroTik implemented their containers you could potentially do the upgrade in the container you have
However the correct approach is to make sure you setup persisting volumes for any data that needs to be persistent, then just delete the container and recreate with the same settings (eg. same env list/mount points etc)
https://github.com/pi-hole/docker-pi-hole#upgrading-persistence-and-customizations