You may have only played the Xbox version, which did have a strict constraint on the map size. The PC version, IIRC, has no such restriction aside from perhaps

You may have only played the Xbox version, which did have a strict constraint on the map size. The PC version, IIRC, has no such restriction aside from perhaps memory and/or maximum possible values. The Far Lands referred to are actually a result of this lack of constraint allowing the player to reach a point where floating point errors begin to wreak havoc on the map generator.