Hello David
Proxy ARP is indeed often associated with poor or misconfigured network designs, as it can lead to various network issues such as broadcast storms and increased network traffic. However, it can also be useful in certain scenarios, such as when network devices are not in the same network but need to communicate as if they were. Sometimes the simplicity of implementation outweighs the negative impacts of security, especially in smaller networks.
As for Local Proxy ARP, it is a variation of Proxy ARP that works within the same network or VLAN. In a standard Proxy ARP situation, a router responds to ARP requests intended for another network, essentially “pretending” to be the destination host and then forwarding the traffic appropriately. With Local Proxy ARP, the router responds to ARP requests even if the hosts are on the same network. This can be useful in situations where hosts on the same network are not allowed to communicate directly for security reasons, such as when private VLANs are deployed.
I hope this has been helpful!
Laz