So your AP’s are Flexconnect but everything is tunneling back to the controller? That is what I assume since you mentioned port 1 and port 2.
When using radius, a minimum of one is required. The location of the radius server doesn’t matter as long as the wlc can communicate to them. If the controller is down, then 802.1x will fail since you are using Flexconnect central switching. Central switching would also mean that port 2 would be down. PSK would still work since to authenticate but since your controller is down, nothing would work.
Flexconnect locally switched is what you should look at as the user traffic would egress locally at the site and not tunnel back to the controller.
You probably already seen many of the design guides and blogs, you just need to determine if all traffic needs to be tunneled to the wlc or not. That would then define if you need local switching or not. Then the guides would help you understand how things work during an outage. Also, typically the controller is connected to an ether channel port (LAG) so the separation of traffic is defined on your L3. The controller would just bridge the traffic.
-Scott
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