The dependency warnings and blocks may be a good idea, since the Distance can both affect AND be affected by displacement.
This cube changes the displacement on the water:
The displacement of this planet (in this case a Corona DisplacementMod animated over time) compared to a non-displaced copy in the Distance affects the results:
And displacement of the cube via material vs an undisplaced copy in the image shows that the displacement is fully accounted for.
I imagine that would get ugly if combined, where the displacement A was being affected by position of B, then B was trying to be affected by A (as B has just modified the displacement of A). So just as-is with the inability for A to refer to B is maybe better safe than sorry, as the CoronaDistance doesn't know if it is going to affect displacement or not.
Anyway, this opens up a world of possibilities! And is great fun to try out!