This question is old and not answered, but turns up first in a Google search for "lms standard discovery". Since I had the same question, I'll try to answer.
The standard discovery is a simplified (but good enough in my case) discovery with fewer configuration options. The discovery modules used, not configurable, are CDP/LLDP, routing table and ARP. If you need to use the OSPF, ping sweep, etc., modules, apply filters, or other fine tuning, then choose the custom discovery instead.