Yes, the old H&M controllers were really intended for the smaller gauges.
The Low Resistance setting simply switches out some of the resistance mat windings so you get a slightly higher maximum output voltage but with not-so-fine control at low speed.
The Half-Wave setting results in a crude pulsed power rather than smooth DC, which can give improved slow speed control of some types of motor but with added noise and potential to heat up the motor.
With our G scale locos and their bigger motors you should be able to get away with any combination of settings as long as the controller can take the load. I don't remember the intended maximum amps of something like a Clipper but I would guess probably 1 amp absolute max. I know some folk use them with O gauge locos. It should have a thermal cut-out that'll trip if you try and draw too much.
In the long term you'd be better off investing in a controller designed for large scale with the high max voltage that our big toys prefer (minimum 18v, more like 24v for many LGB locos)
I can still use the cases and internal transformers of my old H&M Clipper and add-on unit with my small scale stuff (as backup for my layout's main controllers), but the actual resistance mats and switches were replaced long ago with Gaugemaster panel-mount controllers for improved control.