As much as I hate to get into this, the moon does not emit any light. What you see is a reflection of sunlight off the moon.There is a starting point in that equation. If the intensity of light was bright enough to blind at it's source (reflection of sunlight at the surface of the moon) then, yes, it would be an issue. But just because you have a perception of the intensity anywhere along the curve, doesn't automatically mean the intensity, at its starting point, would cause blindness.
A similar application of the same law would be earth's gravity: You move away from the earth, and the gravity diminishes by the same law. But that doesn't mean Earth's gravity is enough to crush you when you are standing on the surface.