The lip of the rim machines flat and the ring bolts to the wheel in similar fashion to a true bead locker, except it doesn't pinch the bead.
Machining the lip down was a concern of mine initially, but the ring itself adds strength, in theory, which was the primary reason for consideration, since the OEs were prone to bending off road.
I was headed this same direction on the FJC but wasn't capable of achieving the 4.0" BS needed without spacers on the front (added cost) plus the conversion by OMF isn't "cheap", and no local resources were deemed acceptable. long term cost (as if they matter, right?) the lighter wheel would be much more effective, considering fuel and wear.
If going faux and not off road, I'd balance conventionally. The reason I went with airsofts was the tires chunked in the rocks, therefore the drive home was miserable and had to rebalance after most trips out. Dynamic balancing compensates for, but if you're primary purpose is on road it's not worth the hassle of.
If you opt for dynamic balancing, don't buy into the online guides. You can't have too much, and when I replace the tires on mine, adding a total of 16-20ozs of airsofts in each wheel, as opposed to the 12ozs now.
For that matter, may add ten golf balls a wheel.
Edited for over use of commas. Hahaha.