So... If a flying fig uses Pulsewave while based, does it only effect any based figures, since they can't legally draw lines of fire to anyone else?

It works just fine, for two reasons:
1. Pulse Wave doesn't target. Hence, the restriction that the Ranged Combat Action may only target the adjacent figure deosn't apply. The Pulse Waver is still allowed to do a Ranged Combat Action, which is all that is needed to activate Pulse Wave in all its glory.
2. Pulse Wave ignores figure bases.

I could see an argument for either side, but I had a feeling this was the answer. Thanks

Pulsewave follows its own rules. All you need to do with PW is check to see if it is legal to make a 'Ranged Combat Action'. It doesn't matter in the case of fliers if one enemy is basing you or all eight squares adjacent to you are filled with enemies, the flier can still make a Ranged action. Fliers will always be able to make at least one ranged combat no matter how many figs base him.

Further, after the Ranged action is checked and passed, you obey all of PW's rules. Ignore figures, terrain, whatnot and so forth.

it is not about targeting. Under hovering it says exactly this: "...hovering characters may not make ranged attacks against nonadjacent characters while adjacent to an opposing characters."

may not make ranged attacks. Pulsewave is a ranged attack. Therefore it is a legitimate question, whether you may only pulsewave adjacent characters if hovering. Rules weirdness, but nothing in the FAQ speaks to this and I have yet to find a ruling by Hair10 on this.

I found a thread with Hair10's ruling:

http://forum.wizkidsgames.com/showth...+wave+adjacent

His explanation seems to rely on the issue of targeting, though the rulesbook does not rely on targeting for its definition, so I am still confused, but at least I know how to rule it anyhow.

Thanks to all.

It has to do with the fact that PW ignores character bases. Once you have verified that the PW character can make a ranged combat attack (and it always can if it is hovering), character bases are now ignored and it can effect everyone within range.

If the PW character is not a flier, and is adjacent to an opposing character, it can't perfrom a ranged combat attack at all, so it can't activate PW, and it doesn't then ignore character bases. It gets shut down right at the start (so to speak) and you can't use PW at all.