Can someone tell me if I'm making an error in my reading of this skill?
As I understand it, the hex spread is completely recursive and will cover any los-visible 'chain' of touching monsters starting with ones that are hexed, hex them all, target them all, then allow you to spend all the hexes they just got to affect the damage on all of them.
So let's say you have 2 visible hexed monsters. Each is next to another monster who is in turn next to a third monster. Plague Cloud with Internal Rot will Hex all six monsters with 2 tokens each, then attack all six with +12 damage?
Even more extreme, if you are Seer Kel you can ignore LOS for every step, potentially affecting basically every monster in the room.