Throwing in my opinion from the point of view that I like things to be easy and not require much extra work on my part... an automatic way to accomplish this would be more useful. Right now, we see players chat from those close enough. Suppose instead, duplicates of that method are used for 2 varying distances from a character.
The closest chat could be in white, then chat from further away a dimmer color. The closest distance could be set to fairly close to a character to limit it to something like a group sitting around a table while the second distance could remain as it is now.
I know this wouldn't help in the case of differentiating a longer range conversation from that of others or work entirely well in a very crowded shoulder to shoulder situation, but it would have the advantage of working all by itself.