I think distance from duchy capital could be implemented to be more of an anti-abuse mechanism than a burden to the game. So, giving an example using FEI geography, Hupar, through various region connections, would have a pretty hefty penalty for being part of the duchy of Remton, but absolutely none to be part of the Duchy of Topenah, Colasan, or Hupar. Unfortunately, Itomazh is stuck with Enlod.
The intent isn't as important as the result in this case. Maybe Hupar has a pretty damn good reason to be in the duchy of Remton? It would create a lot of cases where people will have penalties when they didn't use to.
