Aahhhhhhh good point - my lever is on 5 ( closest set in) here is another with it set on ,1,.With my aging eyes, I can't tell what number on the wheel your at etc.
But with the wheel set to position #1, you should only get 3/4 of an inch movement before the lever is solid and unable to be pulled in further.
I just measured mine, and another bike I just flushed the brakes on, and using your measurement method (mid-lever to the edge of the grip) I'm getting 2 3/4 inches instead of 2.
Of course your lever could be adjusted differently, or your pads could be worn down etc.