One use of the Classify by Feature functionality is that you can apply a buffer to the feature and reclassify the points that fall within the XY buffer. If you use the feature as a surface instead then it activates the buffer in the Z axis, instead of the XY. When your input shape is 3D then you will be presented with additional options as shown below.
Prior to LP360 v2017.1 you would need to toggle the “Z Aware” setting to 3D in order to see these options.
Now we treat all shapefiles as Z aware, and use zero if no Z value exists.