Same experience here. Maybe not 1/4 mile, but still a large distance. Sometimes I'll (intentionally) leave something in my car while shopping, but don't get the notification until I'm across the parking lot and in the back of the store. Also, at airports...I put one in my luggage and left it with family while I went to get food. Didn't get the notification until I was way at the other end of the airport.
I definitely wouldn't rely on AirTags for immediate separation alerts. It's nice if you left something behind at the office or a friend's house. But if you left something behind at TSA at an airport, you could already be boarded on the plane, or at the other end and don't have time to go back to get it.
If you want something more immediate, a bluetooth tracker would probably better, as your phone will detect when the bluetooth connection breaks and notify you. (AirTags are not actually paired to your iPhone, like many people seem to think.)