That formula does not apply to BtS, which added a bonus for overseas trade, one for connection to your capital, the possibility for another from the Temple of Artemis, etc. It seems that all the factors emerge on mousing over the trade route value, as I said earlier in this thread.
BUT I can't explain the effects of trading on the same landmass, when the distance between trading partners definitely has an effect which it does not when trading overseas. For example, Edirne, size 15, an AI city, has a base rate of 2.28 trading with Belfast (mine, size 23) at distances of 32 tiles vertical and 13 horizontal, and a base of 1.74 with Liverpool (mine, 25) at 21v, 17h: Antalya (AI, 8) gets a base of 1.4 with Filmore (mine, 14) at 18h 20v. I cannot work out a formula relating these consistently.
As regards multiple cities trading with the same partners, although each of my cities has its unique set of partners the same clearly does not apply to the AI civs. Pacal has at least six cities all trading with his two largest, Aksum and Gondar, and these two cities are also trading with each other. Unfair, I say, unfair.