I\'ll start with the question.
Is the BTLE RSSI a good way to indicate two devices proximity to each other or not? does it only work with small devices like fobs et
If I understand well, you are trying to implement similar functionality that to what seen in the WWDC demo and what apps like Bump implement. For that RSSI will be adequate. Test for appopriate threshold values (e.g. >-30) and you will be fine.