I am not, by far, an electrical engineer/scientist, but the inverse square law applies to vacuum. All the details about Tesla using the Earth and the ionosphere as a conductor may have meant that he was trying to solve the power loss problem. Do we have any details on that angle?
I know nothing about electrical engineering but there was a documentary on the history channel about this and they interviewed the leading researcher(a professor in the US) and he basically said no ones ever built a tower the size of Teslas to actually test if his theory would work, it didn't get into the details of why the experiment couldn't just be scaled down. But I think he implied there was some sort of critical size you need to get to where it would become efficient.
