by chance what CPU's are you guy's running.
I've seen this in benchmarks before where a graphics card's fps was limited because the game was so cpu intensive that it wasn't pushing the card at all. They showed that by upping the AA or resolution they actually increased their FPS.
To put it simply without going into technical terms. It's possible that by setting your view distance to 10k your GPU is being pushed harder thus taking a load off the CPU. Making for smoother gameplay. This is quite rare and would only apply to top end hardware such as the GTX295 and Core I7's/OC'd Phenom II's