That’s a setting on the older hub models. It determines whether the hub asks for S0 if the device asks for it (S2 is indeed not supported on these hubs), the weird thing we actually can't avoid on the C-7/C-8. (Actually a bit worse here since S2 devices need to also support S0 but S2 saves you from this pit on the newer hubs.)
I'd agree with keeping it turned off except for locks like it is by default. It can mostly only hurt to change, but I'm not sure what might be causing the original problem...
Honestly I have never used the by brand menu, it does the same thing as just pressing include. I think the only advantage is that some of the options in there give you specific inclusion directions for each device. But once you get the inclusion part it is the same inclusion.
Have you tried a complete power cycle including pulling the power for 1 min. I know that was something i found very helpful when having problems doing includes. I have never used a C3 so it is hard to now if that applies, but it was something i didn't when in similar situations
If you are adding devices and starting to run into Range issues that could be a good justification to get the C8 or C8 pro. They have a few things that will greatly improve the range of the Zwave and ZigBee Radios. The only potential gotcha would be very old devices could run into compatibility issues if they didn't follow the spec well.
Yeah the C8 will greatly increase your range. Only down side is I do not think there is a full migration path from a C3. You can restore your apps, but all z-wave devices need to be re-included. I have some tricks so that you can easily swap your apps from the old "device" entries to the new ones but you still have to exclude and reinclude every z-wave device.