Cisco Wireless :: WLC 5508 WGBs And HREAP On LAN

I have a wireless network with two WLC 5508 controllers and 220 LWAPs in the same location as the controllers.  All APs are currently in local mode.  I run a few guest networks as well as some other client networks.  One client in particular uses their network to connect mobile machines to their VLAN.  The only issue is that the machines do not have wireless adapters.  Instead, the manufacturer put inside the chassis, a D-Link WGB, which has an ethernet cable, you then have to plug into the ethernet port.  These devices cannot seem to connect to the network.  I have found, the WGBs do associate on the network, but the wired client behind it cannot pass traffic onto the VLAN.  I have also tried connecting PCs with different SOHO style WGBs from different manufacturers with the same result.
 
After going through Cisco's documentation, I found that using 1230s in WGB mode can resolve this issue since they use IAPP to communicate the MAC table of the wired side clients they service back to the controller.  I have configured a 1230, and used it as the WGB for the client machine instead of the D-Link and it does seem to work, but this would mean configuring a considerable number of 1230s to hand over to the client.
 
The first question would be, Is there something I am missing that I would need to do in order to allow SOHO style WGBs to forward wired side client traffic onto the network while LWAPs are in local mode? Or would the WGB NEED to support IAPP?
 
The second question is that, I may have found another solution to this already, but would like some input prior to committing.
 
This client also uses these same machines with the same WGBs inside the chassis at another location where the client operates the network themselves.  They also use the same WLC model with the same version, and same APs.  The only difference is that they use H-REAP mode with local switching.
 
I also tested this idea, and it seemed to work.  With the AP in H-REAP mode, and the client's WLAN set to local switching, the machine and WGB connected with no problem.
 
So the question with this, would be; would there be any disadvantages in running all 220 APs at this location in H-REAP mode?  What would I be losing if anything?  Also, I would like to keep all other WLANs centrally switched.
 
I understand what the difference would be for this client's WLAN if I ran in H-REAP mode with local switching, but what would the difference be in the other guest WLANs if I set them to be centrally switched?  (Is there any difference between running APs in local mode vs running APs in H-REAP with central switching?)