I think this should be considered a defect.
I have a friend with a large house and the koala wifi is not strong enough. he has a good router and I wanted to put Koala between the router and the modem so that all the traffic on the router is monitored by Koala.
This actually works but only for the devices that have previously connected to the KoalaSafe wifi. If new devices connect to the router wifi then KoalaSafe doesn't pick them up through the wired connection.
Has anyone tried this or seen this?