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I actually do have some experience with this both as a director and being on the receiving end as an actor.

What I have my two actors do is get them to slightly curve their slapping hand.  The "fake" slap should only use the four fingers of that hand (which should always be ring-less).  Never use the palm.

I then demonstrate slapping myself about an inch below the ear and then four-finger-lengths below the jawline.

I can slap myself a number of times this way, making a loud slap and only enduring a slight and momentary sting.

I then have the students slap themselves (not each other) practicing how to make that same slapping sound. 

Ironically, an actual slap on the cheek doesn't make nearly as loud a slap as the "fake" slap below the jawline.

I tell the students this and demonstrate how using the same curved finger slap as above: it hurts a little, rattles your brains and the audience can actually miss it if they don't hear the impact as they do with the "fake" slap.

The students will usually try that themselves out of curiosity.

So this "fake" slap is safer, less painful AND reads BETTER than an actual slap to an audience no matter how close they are.  

Again, if they use the palm, they are doing something wrong, could hit the other person's ear with their fingers, would be using too much force, and won't make enough noise to justify the momentary discomfort.

The students by now should be able to slap themselves (and get a kick out of it) a number of times using this method.

When both parties can demonstrate that they can slap their own selves loudly and painlessly, the slapping actor should then (under your supervision only) gently begin to practice with whoever is receiving the slap.

They will learn the perfect position so that they are no closer or farther away than necessary to telegraph and saafely execute the slap.

This is so great to get such full thoughtful answers to my questions.  You guys rock!  Thank you!  Thank you!

Note to self: remove earrings JUST as you would require your students to do.

#ouch

I have somewhat different advice. My education in stage combat included what is called a "V" slap, which is specifically used for an "in-the-round" performance.

In this slap, the person getting slapped reacts with a clap knap, exactly like they would for a normal fake slap: position the hands directly in front of the belly button and supply the clap sound as the slapper's hand passes by.

However, the slapper strikes a bit differently. He should raise his hand to give the cue, like always, then perform what could best be described as a karate chop, which stops just beside the ear of the person getting slapped, then the slapper reverses the blow up and back to brush past the face, as though he were brushing something off the cheek of the person getting slapped, and end above their own opposite shoulder. The entire blow should stay above the shoulders, and the path should follow a sharp "V", with the point of the V being at the ear.

The advantage of this is that the hand breaks the front plane of the face, creating the illusion of the hand actually making contact. The other interesting thing is that the pause by the ear, when the slapper reverses the blow, begins to look like the point of contact, further solidifying the illusion. If the victim can time the clap knap properly, the effect is astounding and prevents any need to actually strike anyone.

If any of this doesn't make sense, let me know - perhaps I can send a video or something.

I have to strongly disagree with the previous replies to this thread.  I know combat-trained, professional actors who will not do a contact stage slap due to the risk of injury to the eye, ear, nose, lips and teeth, and jaw (especially when performed with the additional energy that an audience inevitably brings to the party).  We are responsible for the safety of our adolescent actors, and a contact slap at it's best is never a guaranteed safe maneuver.  On top of that, there can exist a measure of hesitancy to contact slaps and they often just don't look very good - even in the round.  Use a non-contact method that your actors can really sink their teeth into and sell through a heightened, energetic moment before and moment after, and you will be happier with the results.

I'm in the "no contact ever" camp.  There are just too many variables that can go wrong.  Be off by an inch and you can injure someone for life.  I would also recommend the V slap.  It works really well and looks great.