Why does laying out code on a line not cause a problem with spatial reasoning but a plane would? Are we somehow incapable of applying spatial abstractions when we move up into a higher dimension than 1?
I feel like you are more concerned about implementation than the idea itself. For me it's the opposite - I find it's easier to understand small pieces of text, but making sense of hundreds of 1k lines files is super hard.
Visual programming in my understanding should allow us to "zoom" in and out on any level and have a digestible overview of the system.
Here is an example of visual-first platform that I know is used for large industrial systems, and it allows viewing different flows separately and zooming into details of any specific piece of logic, I think it's a good example of how visual programming can be: https://youtu.be/CTZeKQ1ypPI?si=DX3bQSiDLew5wvqF&t=953
The problem with spatializing complex relationsips becomes very apparent when one tries to lay out graphs (as in nodes-and-edges) graphically. Unless the relationships are somehow greatly restricted (e.g. a family tree), the layouts become a total mess, as the connectedness of the nodes can't be mapped to distances and the edges by necessity have to make a lot of crossings on top of each other.
But most visual programming isn't trying to be a kind of "2D orthography" for language, it is trying to be a "picture" of a physical mechanism.