Yes, they're very strict about what your levels should be during labour. They try to keep them as normal as possible. This helps avoid the baby being born hypoglycaemic.
They'll test your BMs lots of times, and if you do have a sliding scale they'll use this to keep your BMs in range. It's basically a drip which they adjust according to your BMs. I have a pump now so my consultant said I should be able to use this in labour and not have the sliding scale.
I didn't find diabetes affected my labour too much with my previous baby. To be honest, I kind of forgot about it because I was concentrating on labour. My BMs stayed good.