Does pfsense support L2TP/IPsec, OSPF, BGP
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I know it supports L2TP and IPsec. But does it support L2TP/IPsec? Also does it support OSPF and BGP?
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L2TP+IPsec - No, not on 2.1.x, but it should work on 2.2 when it gets closer to release.
OSPF - Yes, via the Quagga package
BGP - Yes, via the OpenBGP package (though both of those packages cannot be installed at the same time due to the fact that they use the same binary names) -
so you just have bare L2TP? Last time I checked it doesn't provide encryption. Am I correct? Or does pfsense provide its own security mechanism for L2TP?
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Nope - You are correct for now, as far as I know.
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L2TP on its own is only an unencrypted tunneling protocol.