No, you’re right, it’s just if you’re setting the distance to only 1(meter, I’m assuming), then you’re saying whatever is at least 1m from the skylight’s position will be captured. If it’s in an interior, you’re most likely picking up the walls, furniture, etc. You can always double check by throwing a chrome sphere in the scene or looking at the Reflections debug view(may need to turn off SSR and other reflection probes if any).
I will say for dynamically-lit interiors where RTXGI, RTGI, Lumen, etc. aren’t available, a skylight with a low distance threshold can work in your favor for “faking” the bounce light since it’s just reprojecting the interior. But in your case you’re using a stationary light so I’m assuming you’re baking.