I can break it down for you… and it’s a pretty easy difference: Neutral wire.
Remember that a z-wave switch or module is an electronic device all it’s own. It has a wireless radio that always needs to be on in order for it to “hear” commands to turn on or off. Obviously in order to have an electrical device running it needs both positive and negative connections. The electricity has to “flow in” on the one side, and “flow out” on the other.
For z-wave dimmer switches that don’t have a neutral line (such as the GE/Jasco 45612), where does the power “flow out” too? Obviously coming in on the hot wire from the breaker box, but where does it go? It takes advantage of the fact that a Z-wave switch uses very, very little power. It “leaks” a small amount of juice down the wire through the lights and back to the breakers box. This is usually a small enough amount that it doesn’t light up incandescent bulbs or LEDs with you have a big enough load.
Now, you’re module, on the other hand, doesn’t have this problem. It has hot and neutral contacts in the outlet that it is plugged into. It doesn’t have to leak any power through the lamp circuit cause it can just send to the outlet directly. It has, essentially, two circuits built inside of it. The one, which runs the module itself, is always connected, always using a little power. The second circuit is the one that sends power to the light and is either turned on or off by the switch. Because there’s no “leak” of power through the light circuit there’s no “minimum wattage” to prevent the lights from turning on.
Now, is it safe/recommended? I have heard at least somewhere that you shouldn’t use ordinary LEDs with a dimmer switch but instead should look for LEDs that are specifically “dimmable.” That said, I’ve been using LEDs for months and months with Z-wave dimmers (one that has a neutral, and one that doesn’t) and I’ve had no problems with the LEDs or the switches.