If Jan or Dengar are within 1 of an enemy but there is an obstruction does intel still take effect?

Yes.

"While an Enemy Squadron is at Distance 1 of you, it has Heavy ."

This does not rely on "Engagement", which some other things do (for example, Mauler Mithel's Damage.

The only trigger is Distance 1 or Not.

It is not reliant on being Engaged like Swarm is.

And as an aside, jans special ability projects out to "2"

I just learned this..

And as an aside, jans special ability projects out to "2"

I just learned this..

Correct, both Jan's and Dengars secondary ability (Utilise their Brace Tokens / Counter +1, respectively)

Its just Intel that's only Distance 1