Hi Tom,
Reed switches are a type of mechanical switch with the contacts sealed in a glass envelope. The switch (if 'normally open' - the only kind relevant in this context) is closed by bringing a small magnet sufficiently close to the envelope. The main advantage of reed switches is their very great reliability. The main disadvantages are their fragility (especially during installation) and the distinctive 'tick' they make when opening or closing. Also, like other mechanical switches, there is always a period where the contacts open and close rapidly for a short period ('bounce') but this is predictable for reed switches and easily accommodated by the hardware used to convert switching signals to MIDI messages.
Because of the 'ticking' I personally wouldn't use reed switches for manuals. On the other hand I would always use them for MIDIfying a pedal board.
Optical switches vary greatly in their construction and appearance, but all use the same priciple. There is an emitter, usually a LED producing Infra-red radiation, and a detector, usually a photo-transistor.
Sometimes the emitter and detector are contained in the same package and may be configured side by side so they respond to a reflective surface in front of them, or facing each other in which case they respond to an obstruction placed between them. Alternatively, the emitter and detector can be bought in separate packages in which case they should be 'spectrally matched' which means that the emitter produces radiation of the same wavelength that the detector is most sensitive to.
Optical switches are also reliable, but need some extra circuitry to make them work. They are silent and easier to set up (in my experience) than reed switches. Overall I'd say the costs are about the same. I always use optical methods for MIDIfying manuals.
I'm afraid I don't know what kind of sensing Hoffrichter uses.
Nick