CS2 apparently treats an Inside stroke layer style as a Center stroke clipped to the object.
You can see this for yourself.
Create a new layer, marquee out a rectangle and fill it with some color. Now add a Stroke layer style of 5 pixels.
Drop-open the Layer Style details and right-click on the Stroke effect and choose "Create Layer". This "rasterizes" the stroke as a clipping layer above the rectangle. Right click on that layer and choose "Release Clipping Mask" and notice the stroke expands to double its size.
This can also be confirmed from within scripting by comparing the activeLayer.bounds values with the Inside Stroke style turned on and off. The bounding box should be the same (because after all, it is an Inside stroke), but they aren't.