Correction to the above post. The do show up zoomed out but only as far out as the alerts are set. For example, mine are set to .5 miles. Therefore, when I am .5 miles away, the cache icon will pop up and an audio ding will be heard.
OT: This worked WONDERS in the field. I tried the alerts in the field today for the first time! It was great knowing you were getting close to a cache you may otherwise have passed up.