Something I've noticed:
If I'm casting an AoE spell or throwing a grenade, and I put the targetter right at the edge of my range, even if the circle surrounds enemies slightly outside the range, the spell or grenade won't hit them. It's like it completely cuts off a large portion of the AoE just because it's outside of my "range" or whatever.
Range should effect how far away the centerpoint of your spell or grenade can be cast, instead of affecting the size and shape of the AoE itself...