The Glowforge is essentially a printing press when doing a project using Convert to Dots; like a printing press in that “ink” or the burn, is either on or off, at whatever specified power level.
Here is a pretty good paper on printing resolutions: http://sites.tech.uh.edu/digitalmedia/materials/3351/Setting_Halftone_LPI.pdf
There are a ton of factors in play, and it really depends on how anal you want to be throughout the whole process as far as resampling, scaling, etc.
I do have a post here somewhere that shows the output difference between different input resolutions (600 points, 300 ppi, etc. at whatever LPI). The test could definitely be taken further as I only printed at one LPI using a few different PPI source images.
(Found it: Preparing a Photo for Raster Engraving (NOT NECESSARY FOR GLOWFORGE)) I think I should have tested it using convert to dots. Maybe not. Too early to think much. Regardless, you can certainly see the difference in the output
Illustrator does have a nice feature that shows the resolution (PPI) of an image when you have it selected, and you can see how it changes resolution as you scale it up and down.
All those things aside, the easiest way to do this, in my eyes, is to, as you found out, just use a clipping mask and then rasterize the clipping mask.