I think it's the distance at which certain objects appear, not the vehicles. ie, under the current setup, you can see the tank, but not the barn/hill/tree it's behind, but when it's fixed, the object will still appear, and the tank will be hidden.
Might have misunderstood HTC's post myself, but I don't think they're going to make GVs disappear due to ground clutter settings. Why render useless terrain objects and not players?