If I remember what iso-8859-1 is then i think so yes. In simple terms the rules will be those of unicode even tho the representation of the codepoints is bytes. In other words the matching would behave the same as would occur if you did a utf8::upgrade() on it before the match.
How the regex engine works under use local will not be changed, except that it won't be "all or nothing", you will be able to turn it for sections of a pattern. I dont pretend to understand the use locale mode and I dont plan to do much with it. (Id like it if use locale "went away" actually.)