I think those charts apply mostly to 720p vs. 1080p. If you are talking about the difference between an upconverted DVD and HD...there is no contest, even at further distances. Your eyes would be wasted on HD if you can't tell that difference. I don't sit at the closer recommended distance to view 1080p. But even with my BDP83, as good as it is, uponverted DVDs never look like HD.
The charts have information regarding DVD. And one uses the same line on the chart regardless of the quality of the upconvertor, because an upconvertor, no matter how good, does not add detail that is not there. And the calculator can be used for it as well.
(For the differences between good and bad upconversion, see
http://www.hqv.com/contentEngine/dspDocumentDownload.cfm?PCVID=6557af58-7e90-e2a3-bea3-f6ec25bf8781. The differences, though often significant, are not differences of resolution.)
If one has 20/20 vision, one can see all of the detail of a DVD on a 50" TV at 16.55 feet. Sitting any closer than that, and one can see imperfections due to the low resolution. In other words, on a 50" TV, if you sit at 16.55 feet or further away, the resolution difference between BD and DVD will not be visible (in actual practice, of course, one might see a difference that has nothing to do with resolution, as two discs may be mastered differently, and so, for example, the colors in one could be brighter or there could be some other such difference that has nothing to do with the resolution). If you sit closer than 16.55 feet to a 50" 1080p TV and have 20/20 vision, you will be able to see a difference between a BD and DVD due to the resolution. Most people probably sit several feet closer than that, and if they don't, they may as well use a standard definition set. To see all of the resolution of a 50" 1080p set, one would need to sit no further than 6.5 feet, again, assuming one has 20/20 vision. With worse vision, one would need to sit closer than these distances to see the relevant detail, and how much closer will depend upon exactly how much worse than 20/20 one's vision is.
And, of course, you are right that most people do not sit close enough to their 1080p TVs to see all of the resolution that they are producing. If they are far enough away, then they may as well have a lower resolution set. In my case, I have a 768p 42" set, and I sit about 8' from it, which is about optimum for seeing all of the resolution it produces. If I had a 1080p set, it would need to be about 20" larger at that distance for me to see all of the detail that would then be possible. But then my upconverted DVDs would look even worse than they do now.