What would you say is the limit of the area of dim light?
Firstly, to answer what defines the "area", we must first identify what "dim light" is -
Dim light, also called shadows, creates a lightly obscured area. An area of dim light is usually a boundary between a source of bright light, such as a torch, and surrounding darkness. The soft light of twilight and dawn also counts as dim light. A particularly brilliant full moon might bathe the land in dim light.
"Shade" is not the same as "shadows", particularly in this instance. For example, this would not be possible in the middle of the day, in the middle of the street, by simply flinging a blanket over you. In the "dim light", you can make out silhouettes and shapes, but only if you look carefully.
On the other hand, standing between two lights sources, one might be able to clearly see your silhouette, but be unable to make out any detail, as you are too far away from the light. In this case, it'd be perfectly viable.
As for exactly how big this area need be - well that can be defined by the DM. How far light may travel is more scientific, and while definable, would merely be playing with semantics. As many other questions have found, physics and D&D don't often mix well.