Hi Mike
Could you please clarify what exactly you need to achieve ?
Because e.g. if you have serverfarm with 3 servers, and ACE which loadblance some traffic to them, then ACE can't be responsible for any of things you described.
I mean - Decision about what authentication Basic or NTLM to use, is made on Client/Server side, not on some device which is responsible for redirection traffic. ACE can't be some kind of Authentication Gateway.
Regarding reauthentication, it's not clear either. E.g client was authenticated on server #1 , it failed, how server #2 can know that client was authenticated on server#1. They should have some kind of synchronization in this case, but it's definitely should run on MS side.