This would be true if the transmitted signal power were omnidirectional in x, y and z. But the transmitted radar beam is (with varying degrees of precision & efficiency) formed into a more or less highly directional main lobe and some inevitable unwanted minor lobes.For radar, it's 1/(distance^4). Both the transmitted pulse and the reflection fall off as the square. Multiply those together and you get inverse to the fourth power.
(Disclaimer: I'm not a radar engineer myself, so I invite constructive correction if I say anything wrong here. I'm not trying to beat it to death but I find it interesting.)
TLDR: the transmitted radar signal is directional and does not exhibit Square Law fall off, something much less severe. The reflected signal is complicated but may be grossly assumed to be something like Square Law.
If the beam were formed into a a 360° horizontal plane (omni in two dimensions), the transmitted energy would then fall off roughly proportional to distance ( linear rather than Square law). An optical analogy would be the design of some signal beacon lights, or some of those marker bollards that wrap a reflector around a column.
But if the beam is formed as a directional projection (really the condition that makes us call it a "beam"), the transmit signal power falls off according to the averaged beam spreading angle.
For radar, this was originally done using the familiar parabolic dish antenna, but later was often accomplished using the so-called phased array. I think the letter concept is the basis of most modern radar and radio communications antennae, for beam forming and steering design.
Here an optical analogy would be more like a flashlight or searchlight, highly directional compared to a standard light bulb.The extreme version of this is a laser beam with extremely little spreading, so nearly all the energy reaches the target with almost no fall-off. Lidar uses one or more lasers with rapid scanning to achieve the more spread-out imaging field angles, but with resolution related to the laser spot size. Then Imaging radar becomes the microwave analogue of that.
In any case, the point is that the transmit beam does not fall off as the square law because it's intentionally quite a bit more focused than an omnidirectional source.
How the reflected receive power falls off can be complicated. The simplest concept is that the target object reflects everything but diffuses it more or less omnidirectionally, at least into a rough hemisphere, which behaves somewhat like omni Square Law fall-off but without losing half the energy to the backwards half of the sphere. In reality though, it depends a lot on the target. Some energy will be lost to absorption, and the complex metallic angles of a typical automobile target will produce a kind of sparkly complex reflection of the transmitted energy. Furthermore, the receive antenna creates a beam form of sensitivity, so that it improves the signal to noise ratio of the received signal by suppressing random energy from non-targeted directions. This effectively improves the square law fall off problem, not in absolute energy terms, but in directional sensitivity terms.
A large flat panel surface, angled away from the transmitter, will throw most of energy away from the source and become more or less iinvisible, one of the concepts used in stealth aircraft and ship design. But this also depends on the materials, texture, paints and so on.
Fortunately for the manufacturers of adaptive cruise control, most cars have not been designed with radar stealth in mind. The typical array of curved painted surfaces, complex parts and shapes behind fiberglass bumpers and so on seem to produce plenty of sparkling/shimmering return energy for the purposes of automotive cruise radar.
But I look at the Cybertruck and it does remind me a little of military stealth vehicles (and that look is probably not an accident); I wonder if it will make a difficult target for these follow-the-eader radars. I don't really know about that, but I do think it could be hell to be around when the stainless panels mirror the sun right into your eye! Maybe I should plan to be in one rather than around one...