2-Tier with WPF Client

My interest is 2-tier with a WPF Client (and a SQL Express database).
As I read the documentation it ploughs straight into 3-tier and I become unsure of what functionality I loose in 2-tier.

I assume that there is no EntityServer running at all. If there where, there would have to be one running on each client PC, as there is nowhere for a common one to run - which is why I am 2-tier.

Is the Business Object Server (BOS) just another term for the EntityServer?

Thus, my key question. What functionality of DevForce do I loose in 2-tier?

  -- do I have all Validation, Authentication, Authorising and Business Rule functionality

[Edit Update]
OK, I've read more of the docs, and found the code example, Console_SecurityWindowsAuthentication
I can see that the Server.dll gets instaniated by MEF as the Console client starts (in isDistributed="false" mode).
In fact I can remove all the config sections except the connection string, and the example still works.

So, that leads to a further question as to how the Client and Server are communicating in a single solution, which is self configuring?
Is there an implied WCF path - either as named pipes or tcp occuring. Or in this mode does DevForce intelligently use direct methods?

thanks
John