This may set up a hornet's nest but I think it needs to be thought about. It probably has been raised before but I can't find the topic.
I have had a cache rejected because it was less than the required 0.16 km from an existing one- it was about 0.14. Fair enough, as the reviewer must administer the rules as they stand. However the cache in question was way up a hill, the proposed one was a short distance from the bottom of the hill near a road, you have to go up a winding path to get up the hill to the existing cache so anyone who found the existing cache in confusion for the proposed new one or vice versa should not be caching! I can do something at 0.16 but it won't be anywhere near as good.
I also wanted to set up a new cache in the city, but it turns out to be 0.15 km from an existing cache and any other location for the new one would be inferior to what I had planned. The thing is that there are city blocks with several buildings in between, if you were looking for either the existing or new one and confused the two you really would be seriously lost!
I suppose things could be a bit different in the forests etc but I still can't see say 120 metres separation being too much of a problem. (100 might be Ok but I realise some allowance needs to be made for coordinates being inaccurate meaning separation could be a bit less than thought.)
I guess the proximity rules may have been set when technology was inferior to what it is now, wondering if it is time to review them.