No, trail bikes are road legal and work just fine on 18" rear and 21" front tyres. The tyres themselves are always the biggest compromise, but as long as you're not riding in seriously wet off road conditions or pushing lean angles too far on the road you'd be fine. I've always used tyres from the off-road end of the spectrum, because I don't use trail bikes to tour, (knobblies wear MUCH faster), I do use them mostly in the dirt and because I grew up riding on knobblies and I know how to make the most of them. I reckon you'd be better with less agressive tyres given the time you spend on the road.
Generations of kiwis have grown up with trail bikes, there's plenty of them out there. The DRZ400s are probably the most bulletproof of the mid/large bikes, and you get to choose from several models depending on your particular end-use. Worth noting that not only is the DRZ400S, (trail bike version) good on the road but the DRZ400SM, (with 17" wheels and road-optomised suspension and brakes) isn't too shabby off road either. Up to a point.
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