My dog will happily sit less than 3 feet away from my sub while I watch DVDs. She might raise her ears during explosions, but otherwise could care less. With music, she seems to completely ignore all my speakers.

I think it depends on your dog, really. I seem to remember another post on this tpoic where some responded that their dogs didn't react and some responded that their dogs did react.

Would someone more resourceful than I care to dig up a link to that discussion?

As far as loudness vs. proximity to the sub goes, I can tell you firsthand that my sub sounds the loudest in the corner of the room exactly opposite of where the sub is. How yours will sound at different points in the room has a lot to do with the size and shape of your room.