I think it would be a beneficial feature to define a text size for different viewing distances for labels. For example, when defining the label, you may define text size 20 from distance A to B, size 18 from distance B to C, size 16 from distance C to D, etc. As the user zooms in and out, the label text size adjusts accordingly.
One example where this is helpful is if you have many entities close by. When you are zoomed close in, you may like a larger label. But as you zoom out and they are crunched together, the labels overlap each other and are visually unappealing and unreadable.
This could work very similarly to the translucencyByDistance property except with text size instead of translucency.