Bob covered it well, I'll just give you more of the "whys".
Adding inductance to the front end of a VFD can help with protecting the rectifier from transients on the line side, and to a small extent, mitigate some of the harmonics. I don't get too excited about the harmonic mitigation capabilities of just a reactor, and that can be done just as effectively with a DC bus choke, maybe even better, if that's all you want. But the protection from line transients is important. The rule of thumb I use it that if the source kVA capacity is more that 10X the VFD kVA rating, then line transients can cause damage to the diodes or SCRs on the front end. Adding the inductor ahead of the VFD slows down the rise time of those transients and the potential damaging effects of current spikes they can cause. Either a reactor or a drive isolation transformer will provide roughly the same benefit in that regard.
But most drives now are designed to work on a solidly grounded Wye supply, where the line to ground potential is 58% of the line to line potential. Protection components such as MOVs and Common Mode Chokes are almost always referenced to ground, so if you have a Delta system or a HRG Wye system, those components can be damaged during a fault when attempt to become a lower resistance Wye point for the entire grid ahead of them, very very briefly, then they are no longer there. You can remove the ground reference on them (some more easily than others), but then you no longer have that full protection. So the better option is to feed the VFD with a Delta-Wye isolation transformer and create a smaller "Wye grid" just for the VFD(s) which has a solidly ground reference. Then if you are going to use that, there is no need for a reactor too.
If you are looking at older SCR based DC drives, the isolation transformer was also necessary for common mode noise mitigation from firing the thyristors. Most new DC drives are now PWM however and therefore have a front end similar to a VFD, so that's becoming less of an issue. Older six-step and Current Source Inverter AC drives used a similar thyristor based voltage control front end so they needed the isolation transformer as well, but those technologies are no longer on the market for LV drives. That's where a lot of the older specs came from however.