A start
Larry Barrett
If A is at grid location 0,0, then anyone at immediately adjacent grid locations (i.e at 0,1 1,1 1,0) will be visible.
Also, anyone at a grid location that can be connected by a straight line to A that does not intersect an intermediate grid location. For example, someone at grid location 2,1 would be visible to A, but someone at grid location 2,2 would not because a straight line to 0,0 would intersect 1,1 which is occupied (doesn't matter if one of the five, or not).
So we could have A, B, C, D located at 0,0 0,1 1,1 1,0, all visible to each other. E would then have to be at a location not on the same rows or columns, and satisfying the restriction above with respect to each of the other four. For example, if E was at 3,2 he would be visible to A (at 0,0) B (at 0,1) C (at 1,1), but not to D (at 1,0) because with respect to D, grid location 2,1 is on the same line.
A,B,C,D could be more scattered and still be visible to each other; for example, at 0,0 1,3 2,1 3,4.
So far I can not find an acceptable location for E for either example or prove there is none for these cases (or the more general case).