The problem with longer ranges, even just a few cm, is the prospect for snooping or triggerring unintended authentications. My preference would be mm range.
The advantage of using a watch (or another device with a built-in screen) is that it avoids exactly that problem. When you authenticate, you have to physically press a button on the device, and the screen tells you precisely what it is you're authorizing.
Using capacitive coupling as the initial communication channel would also help with that, since you'd have to actually touch the object you want to authenticate to with your bare skin.
Do you have any refs on capacitive coupling? Is that essentially touchscreen devices? How does that fare in exposed / outdoor environments? I'm thinking of wide applications, and something which wouldn't operate at, say, Tokyo Subway levels of use and demand aren't particularly amenable.
(That's tabling the discussion of whether or not you'd want to have per-use charges for transit use or want to offer that as a public service, or only filter based on individuals, etc.)
Field range might be set by speed-of-light delays. Roughly a nanosecond per 30cm (about 10 foot).
Given a 4 GHz clockspeed, your time resolution is about 0.25 nanosecond, or 7.5 cm -- call it 3 inches.
The way I'm envisioning it:
1. Physically touch the object you want to authenticate to. (E.g. Computer, payment terminal, smart lock, etc.) Watch uses capacitive coupling to bootstrap a Bluetooth connection to that device.
2. Device requests authentication & authorization from Watch.
3. Watch either authenticates you instantly (for lower security applications), or requests you to confirm the transaction with your fingerprint/face/PIN (higher security applications)
This method would also enable a lot of other neat tricks to further increase security, like checking your heart rate and refusing to authenticate if you're asleep or the watch isn't strapped to your wrist anymore, requiring additional authentication methods to unlock your watch after you take it off, displaying the dollar amount for monetary transactions on your watch when asking for approval, etc.