Why do you assume most have to/want to sit miles away from their screens? Do we all live in mansions?
No just a serious over simplification of the situation. It doesnt not take into account the abilities/perceptions of the individual, its just an average of the masses. Generally people who spend lots of money on hi-def screens are going to be more fussy/aware of picture definition than some arb person who couldn't care if they're watching on a CRT or HDTV.
The chart is actually based on what the perfect human eye can distinguish, so after perceptions and other subjective things come into it, the detail people see will actually be less than the chart demonstrates.