I would not do that unless you really want to use S0. S0 incurs significant overhead (up to 3x the traffic of S2 or "regular"/non-secure-paired devices), and staff have previously recommended using it only when necessary (e.g., door locks or other devices). The choice, however, is yours. In my testing of various devices with the C-7, I did have better luck with S2 devices if I unchecked all options. But you could certainly try with whatever level of security the device supports (or just S0 if you prefer for some reason)--it's not that it doesn't work at all, just that some people seem to have problems with some devices.
For your "stuck on initializing" problem in partuclar, I'd see this thread and the various responses: New inovelli switches stuck on initializing C7 Hub, mostly this workaround from staff:
