I left out the Dist part because it wasn't in your first post. But yes, you are right.
Using your terms, the formula is (not factoring target AC or status effects):
If PE ≥ 5, ToHit = Skill + (PE * 8) - (Dist * 4), with no Dist penalty before (PE -4) * 2 hexes.
If PE ≤ 4, ToHit = Skill + (PE...