1) How necessary do you believe in local NTP servers? Do you really need the logs to be perfectly accurate?
what is "perfectly accurate?" perfection is not very realistic. to what use do you put these logs? what precision and jitter are required for that use? imiho, if you are just comparing router and server log files, run off public. if you are trying to do fine-grained measurement, you are going to invest a lot in clock and propagation research.
2) If you do have a local NTP server, is it only for local internal use, or do you provide this NTP server to your clients as an added service?
i would generally let customers chime off routers which are strat 2 or 3. if a customer has other needs, then they can deal. if they are really concerned, they should not bet on me anyway.
3) If you do have a local NTP server, do you have a standby local NTP server or do you use the internet as your standby server?
again, depends on your needs. randy