Absolutely you can do this.
Here are a few config snippets I have on my office 3130 which acts as my DHCP server but also my DNS proxy for my local devices. (These features are available on all Adtran routers).
Enable the domain proxy and specify the upstream OpenDNS servers.
(Added from the Configure Terminal mode - WebGui instructions are below).
name-server 220.127.116.11 18.104.22.168
Create a DHCP pool for my LAN interface... (Pointing my clients to the Adtran router for DNS).
ip dhcp pool "Home-LAN"
network 192.168.1.0 255.255.255.0
The above values match the IP information on my LAN interface which looks like this...
interface vlan 1
ip address 192.168.1.254 255.255.255.0
ip access-policy Private
This can all be done via the WebGUI also.
The domain proxy and DNS servers are configured and enabled under the SYSTEM->Hostname/DNS tab.
The DHCP scope can be created under the SYSTEM->DHCP Server tab. Just type the name of the pool, click Add and add the required bits (Subnet Address, mask and default gateway are required fields, then the DNS servers are configured on the 'Optional configuration' tab. You want the DNS server in the DHCP scope to be the IP address of the LAN facing interface to allow the DNS proxy to do its thing.
You are Welcome!
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OK, I finally got up the nerve to try this.
The very first thing that happened is an Invalid subnet error.
I'm trying to configure a Class B network (I need more than 255 IP addresses).
Is this router (3430) NOT able to do Class B networks? (I know some can't but I always thought they were the cheaper NetGears and such).
If I can't set up a Class B, then I guess I have to try something different.
After a call to tech support it turns out I misconfigured the DHCP Server Pool settings. I'm familiar with how Apple does DHCP on their OSX Server, so the "wording" of the configuration tab confused me. I needed a Class B subnet with IP addresses in the 192.168.1.1 through 192.168.3.255 range. In order to do that I needed to assign the Subnet Address as 192.168.0.0, with a subnet mask of 255.255.252.0 (which is the subnet mask I'm using now). I set the router as the Default Gateway (192.168.1.1) and set OpenDNS as my Primary and Secondary DNS.
I excluded the 192.168.0.x part of the network and the first 50 IP addresses of the 192.168.1.x network since they are statically assigned.
As soon as I figure out the DNS part, I'm going to shut that down on my Mac Minis as well.
I turned on DHCP last night (turned it off on my Mac Mini) and this morning the router is handing out IP addresses just fine. So far, so good!!
Well, got DNS working as well - I am a happy camper. Just retired my last two servers. I have one NAS array I use for Time Machine backups of the Admin staff and, maybe, some local storage for next year. But that's it. A router, two controllers (for wireless redundancy) and the NAS. Running 200+ devices - all is good!