It's the latter. As I have mentioned several times here previously, the "old" 27" iMac is almost retina resolution already at 2560x1440 if viewed from 32 inches away...
The point where the old iMac becomes retina is beyond 32" view distance (assuming perfect eyesight), so at that point, there will be no visible difference between the new 5k iMac and the old one.
You'll only see the difference if you move closer to it.
So where did you find this figure related to "retina resolution" as a function of distance? I must admit when I was at Apple store looking at the 2 screens side by side it was not easy to see a difference, but I may have been more than 32 inches away from screens.