It looks like in the original code, the original development team intended to create a checkbox that toggled nameplate distance between 20 and 41 yards, but ran into a technical limitation.
In an upcoming build of the Burning Crusade Classic Beta, you can set the nameplate distance between 0 and 41 yards (inclusive) by setting this command in the chat box:
/script C_CVar.SetCVar(“nameplateMaxDistance”, 41)
/console nameplateMaxDistance 41
Thanks for the suggestion!