Nearby is drawn around wherever you are right now.
How far it reaches
The area grows and shrinks on its own. In a dense part of the city it stays small, because there is plenty to read. Out where little is posted it widens until there is.
You cannot set it
There is no radius control, and no number to tune. A slider would turn reading your city into configuring it.
It follows you
Move across town and Nearby is about that part of town instead. Nothing is saved as a home area.
Nobody learns where you were
Your location decides what you see. It is never attached to what you write. A post shows where it was written only if you put a spot on it yourself.