I have a Watchguard XTM 2 that is currently acting as a firewall and a router for my business network, I currently have the WG setup in mixed-routing mode and am happy with the current configuration. The reason I am curious about drop-in mode is because I would like to use all the interfaces on the back of the watchguard for the same subnet.
My understanding is that drop-in mode will put them all on the same subnet, but it is unclear from the manual that the routing/firewall/vpn will still work as expected.
This WG is right behind a DSL modem that is setup in bridge mode, so the WG is handling all PPPoE auth and routing for the network.
We have a xtm21-w and according to the docs in drop-in mode all the interfaces are on the same network.
From the watchguard online docs