Well, signal strength yes - it does have those limits. But pressure data from the barometers can describe some higher altitude conditions (if you can map pressure at the surface over a large geography with decent density, you can infer metrics about the higher atmosphere).

And I do agree that other instruments are required for a complete picture of the weather, not just phones! But a remarkable amount can be done from phones. GPS attenuation for example, can also be read from some Android phones and can inform about high-altitude conditions.