The inverse law is irrelevant in incidental light readings (after all, if the light comes from the sun -92 million miles- does it matter which side of the Grand Canyon your'e standing on in relation to your subject?)
However, what does matter is that both your subject and the meter are in the same light (not subject in the shade, you in the sun etc).
Point the dome on the meter towards the camera (away from subject) along a line parallel to that between the camera and subject.
Can't be any simpler!
But you don't show that you understand, and certainly do not answer the question.
Incident light metering meters the light incident on the subject.
So far so good. It indeed does not matter, if the light falling on the subject comes from very far away, where exactly you hold the meter, an inch (or any other unit that's relatively small, compared to the distance to the source of light) closer to the subject or closer to the source.
But after falling on the subject, that light has to travel from the subject to the camera to be captured on film.
The subject acts as the source of the light you will allow to fall on the film in your camera.
The question is why, while traveling that distance, it would not spread out and behave according to the inverse square law.
And if it does, why the reading would not change, depending on how far your camera is from the subject. Why do those mountains lit by a distant sun, appear equally bright when you move a considerable distance away?
And the answer to that is that it certainly does behave according to the inverse square law.
With increasing distance, less light reaches the light gathering area of your lens.
The same 'mechanism' (distance), the same geometry however is also responsible for the apparent size of the subject: it diminishes at the same pace as the amount of energy available to create the image of the subject gets less.
The thing that varies with distance is the size of the solid angle, the size of the area that both determines how much light is captured and how big the thing will appear.
The result is that the same exposure will create an equally bright image, no matter how close or far away you are.
Perhaps it's easier to see if you think of light as paint: You do get less of it if you put a bucket of a given diameter further away from a paint spray. But that lesser amount will suffice to cover a lesser sized area in an equally thick layer of paint.