Make the level all one map or use loading screens?

[Cranky Old Man]

There is a big relief in knowing that there is no hardcoded map size limitation, because that means that I don't have to worry about where in the overall map, the first room I create should be.

There is, however, an issue that entity interactive properties stop working after a certain distance.

You mean the distance between two entities affecting eachother? If so, can't you just add an invisible lever in-between that sort of carries the signal like a middle man?