The distance is critical on the front. You will notice (on most fenders) that the actual fenders are attached to the stays via a bracket that is riveted to the fender. If that bracket gets too close to the tire, there is the risk that the tire will wear down the rivet(s). If that happens, and the bracket comes loose, there is the risk that the tire will pull the bracket forward. The further forward the stays are pulled, the closer the bracket gets to the tire, until the bracket and stays actually stop the tire like a very effective mechanical brake. This will cause the bike to come to a VERY sudden stop.

Trust me on this one, it's happened to me. The force of the stop was enough to bend the steel downtube (which probably helped reduce the force of the impact when I landed with enough force on head and shoulders to destroy the helmet).

So now I keep a very healthy gap between the front tire and the race blades I now use.

It's not as critical on the back, but you can still lose control when the rear wheel comes to a complete stop!

Luis