From my experience at an Alternative School, we used what we called a Blended Classroom to teach HS Math.  We had students from all over the county and on different levels in the same class.  The way the school was set up (6th - 12th), the students were placed in classes by grade level not academic levels. 

We used a computer program called GradPoint and assigned the HS students their missing math classes, (Algebra, Geometry, Liberal Arts, Algebra II).  I taught 10 to 20 students at a time.  I had computers arranged around my room where I would place students together taking the same course.  You find the self-motivated students worked at their own pace, made good use of the resources available for example: teacher, text books, computers, Kahn Academy.  These students usually accomplished a lot and would finish their course months before the end of the school year.  This allowed them to start another course or take an on-line course.  They could catch up with their class and graduate or even get enough credits early and graduate early.

The majority of the students needed a schedule and had to be reminded to stick with the schedule in order to meet the course requirements.  They were not motivated and did not like to learn on their own at their own pace.  They would need constant supervision and be better placed in smaller group setting.

I know this was probably the worse case scenario because the students at this school were drop-outs returning, out for discipline or truancy reasons.

I guess for a large part of the population this would be advantageous.  As a math teacher I definitely see the problems when students have gaps.  These gaps are either they did not understand in the amount of time the concept was taught, could be coming from a different district that did not teach the concept yet, or may have been out when the concept was taught.

We do not have a system in place currently that identifies these gaps or gives us the opportunity to help students on a one to one basis.