Maximum distance: For the same reason they don't want you using the cell phones from aircraft. The system is "one size fits all". So if using your phone in a "typical" area results in ten towers receiving your signal, ten towers are debating who should handle your call, tying up network computer resources while they arbitrate that. Now extend the range of the phone, and maybe 50-100 towers have that same discussion. Repeatedly.
That's a lot of resources being consumed.
But if you screen every call, apply a simple latency measure to it and ignore anything outside of a small range...you don't need to waste resources while the cell sites are debating who should handle the call.
There's a lot of policy that goes unpublicized because "Don't confuse the rubes". Or perhaps, don't upset them. For instance, AT&T would never give you a busy signal if you called someone's cell phone and the call could not be completed because the cell phone was logged into a tower that was already at capacity. They'd just shunt you to voice mail, and the person you were calling would never know you had tried to call them. Until the saw a "missed call" or voicemail indicator sometime later.
Fair? No, but it hides the fact that the carrier doesn't have enough capacity to complete calls. And when customers paid per minute to retrieve their voicemail...it also increased profits, since a busy signal was free. Gee....
The cell phone business is about business. The technology isn't a consideration, except as to how it can be made into profit. Encryption? Eavesdropping? Sure, there are techno fixes. But would they help increase profits? Arguably, not as much as selling special encrypted phones to those users who demand them. Or, simply ignoring the issue.
It isn't just cell phones. The landline system has rules and options that are generally not publicized as well. When there's a disaster and the system is overloaded, outgoing calls are given priority over incoming calls. That's in the assumption that folks who are in the disaster area have the greater need, to call OUT to others. Does the average customer need to know this? Not really, so you won't see it mentioned in the front of the phone book. But the info is out there, if someone digs for it.