Does the answer change depending on whether he has levels as a monk?
According to the Player's Handbook an unarmed strike1
may be a punch, kick, head butt, or other type of attack. (119)
Thus--in typical cases--even with both hands occupied a creature with no natural weapons but the feat Improved Unarmed Strike threatens adjacent squares, and a Medium creature using a two-handed reach weapon and that also has the feat Improved Unarmed Strike threatens all squares within 10 ft.
This doesn't change if the creature has levels in the monk class.
- Link supplied for comparison. The SRD doesn't contain the quoted text in the description of the unarmed strike as a weapon, a frustrating and glaring omission.
As KRyan points out in the comments, the answer below draws heavily from the FAQ which, while official, is sometimes contradicted by actual printed rules, and should probably be looked at as an officially-endorsed set of house rules. The Rules Compendium (which has its own issues) explicitly says
[T]he rules don’t come out and say that a Medium creature threatens all squares within 10 feet while wielding a reach weapon and wearing spiked gauntlets. However, it’s appropriate to assume the creature does just that.
So by analogy from there, any character who is able to threaten adjacent squares (from spiked gauntlets, IUS, or otherwise) does so even when wielding a reach weapon.
There's a lot of variations on this seemingly simple scenario - I'll try to touch on all of them.
What if you have one hand free?
First of all, if the character has a one-handed reach weapon in one hand, and a non-reach weapon (or the ability to threaten with an unarmed strike) they definitely threaten at both their natural reach and their extended reach. No question there. Most reach weapons are two-handed, however, so that's really an edge case. The normal scenario is a bit more complicated.
What if you don't need to use a hand?
In the official FAQ PDF that used to be released every so often, there's a question (page 50):
Is a character wielding a two-handed reach weapon (such as a longspear) and wearing spiked armor threatening all squares within 10 feet? Assuming he has Combat Reflexes, can he make an attack of opportunity with his longspear and then with his armor spikes in the same round?
A character wearing spiked armor threatens all squares within his normal reach (5 feet away). If he also wields a longspear, he would also threaten all squares 10 feet away. Any time a character wielding more than one weapon is allowed an attack of opportunity, he can use any weapon that threatens the opponent who has provoked the attack. In this case, imagine an enemy who charged the character and then tried to disarm him. The charge attack would provoke an attack of opportunity from the longspear as the enemy moved out of a threatened square (in order to move adjacent to the character and deliver the charge attack). Then, the disarm attempt would provoke another attack of opportunity (assuming the enemy didn’t have Improved Disarm). This attack of opportunity could be made only with the armor spikes, since the longspear doesn’t threaten an adjacent enemy.
This only covers the case where the character is wearing armor spikes, though, and they don't take up a hand. This also precludes making an actual unarmed strike - you're attacking with the spikes instead.
What if I only hold my weapon in one hand?
One option sometimes suggested is to remove one hand from your two-handed weapon in order to threaten with your now-free hand. This is very similar to freeing up a hand to spellcast with that now-free hand, so I'll quote from a FAQ entry (page 11) which addresses the latter:
The light shield doesn’t give you a free hand for spellcasting, but since you can hold an item in the same hand that holds the light shield, you could switch your weapon to that hand to free up a hand for spellcasting. (You can’t use the weapon while it’s held in the same hand as your shield, of course.) The rules don’t state what type of action is required to switch hands on a weapon, but it seems reasonable to assume that it’s the equivalent of drawing a weapon (a move action that doesn’t provoke attacks of opportunity).
Given this entry, you have to choose between wielding the weapon with both hands, and thus only threatening at reach, or holding it one hand and having the other free, which lets you threaten in melee range. You can't do both at the same time, and switching between them takes an action you can't do between your turns.
(As a side note, I believe Pathfinder explicitly ruled this to be a free action that could only be done on your turn, so you still can't switch freely, but you don't require any actual actions.)
So what about using a spiked gauntlet or Improved Unarmed Strike to threaten?
If you're wielding a two-handed weapon in both hands, you can't also use another weapon with one of those hands. So you wouldn't be able to use "unarmed" attacks while also using one. However, monks specifically get, as part of their Unarmed Strike ability:
A monk’s attacks may be with either fist interchangeably or even from elbows, knees, and feet. This means that a monk may even make unarmed strikes with her hands full.
This means that a character with one level of monk (or equivalent) can threaten with unarmed strikes while wielding a two-handed reach weapon. They still couldn't use a spiked gauntlet or anything similar, though.
In short (based on the FAQ):
- A monk can do it.
- Any character wearing armor spikes (or equivalent) can do it. (No other requirements)
- Any character using a one-handed reach weapon can do it. (Assuming IUS or a weapon in the other hand)
- No one else can.