I think it has something to do with proximity in breaking stealth, Aura Whisper does the same thing for me if I'm too close. It doesn't work on all NPC's, nor should it I think, but it works for most of them. I've used it to send an entire cave of bandits into a corner, just for the lulz really, and I'll occasionally shoot arrows in the other direction at a wall just to watch them run back and forth while waiting for cooldown. Come to think of it, archery is iffy on occasion in close quarters too. If I shoot too close to a hostile NPC, it sometimes breaks stealth as well.
Proximity does factor into stealth, and using certain "stealth" skills too close can still cause you to be detected. Think of it as similar to how a gun's silencer works: It doesn't completely eliminate the sound, but it does reduce the report to a quiet whisper.
The same applies for firing an arrow: Nocking one is soundless, but if you're too close when you let it fly, it might negate the sneak attack bonus because the sound got you detected before the arrow struck.
Upside is that the better your sneak skill and stealth game improves, the closer you can get without being detected for perhaps taking a clean shot with an arrow.