I don't know if Baam's flare wave explosion comparison is actually a good argument for your point. Baam was taught by Ha Jinsung, a close range fighter, so Baam himself has a similair fighting style, evidenced by his fight with Reflejo, Kaizer, Hoaqin and Data Zahard to a certain extent. Thus making it his specialty, but as you say, his strongest attack is not really in hand to hand combat. That means that just because hand to hand is Yuri's specialty, it doesn't mean her strongest attack also involves hand to hand combat.
But think for yourself about what I have said. Karaka just survived Kranos, one of the most powerful needles in the Tower. Why would Yuri even dare to underestimate Karaka any further and hold back when she is also seriously trying to kill him. That just isn't logical. Maybe it isn't her ultimate ultimate ultimate technique, but I'm pretty damn sure it's close to her strongest.