The long range sights on the C96 were for just that, make 'em keep their heads down over in the other guy's trenches. Same purpose for the artillery model Lugers. They were sometimes employed by machine gun crews while clearing a jam, changing barrels, or starting a new belt. Granted, you can't really expect to hit anything, but still if some guy's potting way, you're gonna keep your head down. keep in mind this is WWI era trench warfare and there are extensive trench systems. So what if it lands in the next trench over? And you have months to sight in, nobody's going anywhere.
Before somebody says it's a C96 and WWI started in 1914, remember the Boer War and a couple of other little incidents before that.
Probably had soime value as an advertising gimmick too. The Borchardt and Broomhandle were a new order of performance for handgun velocity, hence range.
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