VLANs on the Asus RT-N16

On some routers like the Rt-N16 and builds of DD-WRT you have the option of segregating one or even all of the LAN ports on the back of the router and keeping the LAN traffic separate on each individual port.  This is done through DD-WRT’s use of VLANs (Virtual Local Area Network). Why would you want to do this?  I’ll answer that question with the scenario below.  

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