It would be hard to understand when you got spotted by a Triton with double perception that is hidden. Some of them have pretty high stealth so that this happens quite often. Then you would not be able to use vanish but don’t know why.
Additionally a revealed Infiltrator already goes back in stealth mode when he is unspotted for one turn, so this vanish to do it immediately would be a bit underrated for a lvl 6 skill IMO.
I’m not sure, making stealth mostly an option for long range could be to much.
When I use Infiltrators without dual classing then mainly to spot enemies and for this I have to move them in some exposed positions. Vanish is then somehow the last resort if something went bad and also needed to deal with the high perception and stealthy Tritons (they can spot and reveal an infiltrator without Thief perk from 15 tiles distance, that is quite a lot IMO).
I still think that drop the damage buff to 50% would be enough. IMO it would be OK’ish for single class Infiltrator with only crossbows (don’t forget them) and also on par with Brawler, Bloodlust and MoD (all of them can be mixed together, not only with Sneak Attack).
Additionally Vanish already got a (hidden and undocumented) nerf. In “the good old days” a vanished Infiltrator keeps this state through the whole enemy turn and was so (mostly) save from any enemy. Nowadays the vanish state ends with the players turn, in the enemies turn he is nothing more than a normal Infiltrator and so pretty vulnerable. You already have to be pretty careful with Infiltrators in close to mid range of enemies, of course only when you not kill 'em all.
And another edit:
When Assault/Infiltrator should not longer can use Sneak Attack with melee weapons and the vengeance torso for 1 AP melee attacks then there is a second combination that is close to this: Assault/Heavy with Vengeance Torso and 50% dmg bonus because of Brawler. With a normal melee weapon this is already pretty deadly and turns into a chain killing rapid clearance machine with the ancient Scyther. Currently the Infiltrator combo is just stronger because of the 100% damage bonus but also costs more WP for vanishing to achieve (Brawler don’t need any WP, it is passive).