Um, are you sure about that? Because I really don't think that is true.
I believe Leadership is like an aura which affects all characters in a certain radius around the leader, but if you're halfway across the map you don't get the bonus.
Tested the smoke in combat just before posting, I'm sure it works that way(just group up your leaders, oil+flame on them and everyone loses the bonus). Invisibility definitely worked that way out of combat, before starting the first EE game tried it on a rogue at the starting beach.
