If you increase weapon range and speed, then we might as well play the game in the warroom all the time and just move little icons around instead of bothering with detailed ship sprites. Supreme Commander had this issue, actually -- it was more optimal to play the game from the map-view so you could see the entire battlefield while giving orders.
So, hypothetically, we could take that icon-pushing game, divide all the weapon ranges by some number and decrease game simulation speed by some factor, then make the ships beautiful sprites with weapon effects instead of icons and play that game instead because it's a heck of a lot prettier!
What I'm saying here is that the weapon ranges are what they are to facilitate a game that you can play while seeing the ships fighting each other on one screen and see all the pretty explosions and debris flying off etc. There is no 'realistic', no reality to simulate because there is no real space combat -- it's entirely what we choose to make it. Truth be told, Starsector is very, very roughly based on some extreme idealization of WW1/WW2 naval combat which took place in a time when ships could see each other by sight!
(And if we start asking questions about bullet velocities, why cap ship velocities? Or battlefield size? Why even have giant space battleships when you could just use tiny missiles accelerated to a decent % of light speed to blow up planets from the next star over? Why the heck is it viable to trade manufactured goods between planets when the energy required to move said goods is far greater than that required to manufacture said goods a few million times over, at least? Ow, my brain!)
There is perhaps a place for a hard-science space combat game based on strict interpretations of velocities and distances, but it ain't the game Alex is making. And it'd be a bunch of icons, velocity lines, and numbers. Which could be cool, actually.
That said, modders are of course absolutely free to do what they like with the game! Don't like limited ranges? You can fix that.