As this feature enables you to switch objects based on distance from the camera, any camera needs to be properly assigned. Please see attached screen-shot.
If wanted, you can use the pivot point of the object assigned in the Look-At Target
slot as the origin for the Max Distance
measurements (to enable it, select the Use Look-At Target
check-box). This allows you to separate the camera and origin used for all LOD calculations.
Hope that helps.