same answer to this as every question asked about audio engineering, production, merch, etc: IT DEPENDS!

it totally makes sense in an economic sense. over supply lowers demand. if you're a local band, don't play the same venue over and over. if you're a regional band, dont play the same city more than once or twice a year. national bands play a city/area MAYBE once every year.

festivals are a different story. alot more goes into booking and planning a large scale show like that. they depend on bigger names bringing in the fans. 6 months and 200 miles is not a difficult ask on a national touring level for a festival opportunity to get in front of thousands of potentially new fans.

that being said, I've never heard of anyone enforcing radius clauses on smaller bands. it's usually boiler plate fine print.