The Reflection effect can be applied to any node that is transformed with any transform, but it will apply its effect to the untransformed version of the node and then transform the results as it applies them to the destination.  This can affect the quality of a reflected node as the scale is changed.  Note that the potential loss of resolution will be seen both in the reflection and in the primary view of the node - thus adding a reflection to a node that is already visible and transformed may suddenly change the look of the node as the reflection is enabled.