This is the official line on backing up a server with TM:
Restoring OS X Server from a Time Machine backup
I've found that a full-system restore didn't result in a completely functional server. I'm not sure why not. The best practice is probably to use both TM and a mirroring tool such as "Carbon Copy Cloner" or "SuperDuper." In case of a bare-metal restore, I would restore from TM first in order to preserve the backup history, then (if necessary) restore from a mirror backup. Any files that need to be restored from the most recent snapshot can be recovered in the time-travel view.