[serdjo]

Is it possible to limit bluetooh range to just a few centimeters?
I do not want to detect every phone in 10 meter radius but only those that get very close(like 10 centimeters).

This would be very useful in such cases as mobile payment at a vending machine: user just brings his phone closer to the vending machine, then a "beep" sound is produced and a j2me application on the phone is automatically activated (via push registry) which makes payment to the vending machne - very similiar to those "Edy" RFID payments at japanese POS terminals and subway gates:
http://web-japan.org/trends/business/bus041129.html

sergej panic

[petrib]

There is probably no way to limit the range in software (at least not on the phone).

You could try to find a Bluetooth hardware provider that you can cooperate with to get a Bluetooth radio or antenna or whatever it takes with a very limited range.

Then use that in the vending machine or whatever machine,kiosk or point of sale device you are building. (In any case, you would do this limiting on that point of sale device, and not the phone.).