The least restrictive environment, also called “mainstreaming” is the main classroom with non-disabled peers and is considered preferable for all students.
Unfortunately the LRE suggestion makes it easier for schools to deny the greater expense of the direct instruction that many special needs kids need to learn meaningfully. I have heard school administrators deny parents request for one-on-one instruction and small classroom instruction, with the excuse “we are obligated to educate your child in the least restrictive environment. Taking him out of his regular class and putting him in a small classroom, will restrict him from being with his peers”.
Of course all parents want their children to learn in the most “normal” environment possible and have ample opportunities to make friends, or “socialize.” But, if the child is in all mainstreamed classes and is not really learning and absorbing the curriculum, what good does that do?
I have experienced parents who want their child mainstreamed at all costs. I disagree with them IF the child doesn’t learn in the larger classroom. My personal priority is that my child learns the academic curriculum. Socializing can be adequately be done with family or otherwise in the community.