I don't really get the reasoning behind the cap, it's not as if the game would get unstable past that, since that it works fine for the most part through mods. Overly challenging to the player? Perhaps, though that's the whole fun of it if one chose to make such household.
I suppose it might also have to do with ensuring best performance for all players, given machines with less processing power or RAM could struggle to have that much action happening all the time? It's quite weird if so, after all I don't recall people complaining about that matter regarding inviting larger amounts of Sims over to a lot.
