Inferno´s initial hit only applies in AOE range, not @ full range. (This is present aswell in live server).
It might well be in the designed effect however, even if it is, it's still a bug. Hopefully there's a fix for it.
Yeah I would also guess they designed it like that, has been like this forever as far as I know. Would be nice to have it changed to do that AoE damage around the target and not the source.