Unfortunately, in OFP, sound attenuation over distance only really works with Creative Labs sound cards (EAX or no EAX, doesn't matter). I have an old SB Live (an insult to the PCI standard and a complete piece of ****, but OFP needs it) and a Hercules Fortissimo III (Cirrus Logic-based sound processor) and the latter, when used for OFP, makes the sound stage completely ridiculous - all sounds everywhere on an island are played as if they were right inside my player avatar's head.
Actually, I've heard people with the nVidia SoundStorm APU that have working sound in OFP too, so the CLabs-only rule isn't set in stone. But for most non-CLabs/non-SS people, you are SOL.