What do you define as moderate? I have good knowledge of my local special schools and the children who attend them have profound and multiple needs and are undoubtedly in the best environment for them. I wouldn't want most of the children who are currently struggling in mainstream to be lumbered into the special school because chances are that their needs are not as profound, otherwise those children would already be at a special school.
If you are talking about children who struggle to read and write and can't do maths (even at secondary level), but can walk, talk, make themselves understood, use the toilet unaided then in my opinion they should be in mainstream school even if they need some 1:1 support.
It sounds too much like 'we don't want them in our school, disrupting our lovely intelligent, neuro typical children, so send them somewhere else' to me.
At secondary level children are streamed for a lot of subjects so the precious intelligent neuro typical children won't be disrupted all day long.
If teachers are averse to teaching children who don't fit their image of ideal then perhaps they are too judgmental to be in the teaching profession.
Seldon - I'm glad you came back and clarified about the remedial block. To be honest I think of the remedial block idea as a form of unfair segregation. I am cringing at imagining the pupils in that block being made to believe that they are not as good as the people on the other side, jus because they are not as academic. Any kind of segregation can lead to one group of people feeling inferior, but when that segregation takes place daily within a class proximity environment it can be very damaging. I do agree with you about parents and children adhering to the school rules. Things like attendance, good behaviour and punctuality are things that most people are capable of but even private schools have some issues with those things.