More specifically, the Diamond and Gold Sponge can clear 197 blocks. Or 196 if we ignore the water block source that's replaced by the sponge when placed

Woops, must have mistyped when I was assigning the values for all the sponges, diamond should clear 256 blocks with a max distance of 42. I'll fix that now, and release a fix later today.

So does it mean that an Iron Sponge being able to clear 128 blocks away is intended?

public static Block IRON_SPONGE = new ExtraSpongeBlock(FabricBlockSettings.copy(Blocks.SPONGE), 128, 128);`

Ah whoops, I probably left that in when I was testing the different values originally. It was supposed to be 18. Just fixed that too.