It is. Too close is an issue for a node as the RF signal will be too strong and distorted.
You ‘gateway’ is Dragino LG01 which is a single channel ‘gateway’. Is your node transmitting on the frequency and spreading factor your gateway is set to? If not it will never receive the transmissions.
Nodes do not connect to gateways. LoRaWAN is not WiFi. A node broadcasts a transmission and any gateway within reach listening at the right frequency and spreading factors can receive the transmission (and will forward it to TTN back-end if the gateway is a TTN gateway).
As you are in Australia (according to you gateway frequency plan) you encounter the ‘what frequency plan should we use, AU915 or AS923’ dilemma. Check this discussion.
Regarding the gateway not being connected, check this and this.