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Still less than an inch. This does mean you could be more clumsy and still get a good read, though.

I wonder if new NFC hardware is required on the phone and device side or just the phone side.
Good question. I suspect both.

At least now I may know why my cased phone generated read errors trying to trigger the pad at the pharmacy yesterday, while my actual card worked fine when right over it; I probably held the phone further away than .2 inches 🙄
 
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As long as there’s a physical key backup to a digital lock, it doesn’t matter how secure the digital portion is. Lockpicking can be surprisingly simple and fast with a cheaply made core. Most digital locks can be bypassed or defeated by relatively simple means since they tend to skimp on providing a decent physical core to their locks or have other easily bypassed issues
 
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