This is really not unique to XFS... anyone who worked on a filesystem in at least the last decade would tell you that a test like the one similar to what OP ina

This is really not unique to XFS... anyone who worked on a filesystem in at least the last decade would tell you that a test like the one similar to what OP inadvertently created are commonplace. Unlike with many user-space applications, filesystems have very well-defined range of conditions they have to work in. Eg. every filesystem worth its salt will come with a limit on number of everything in it, i.e. number of files, groups, links and so on. And these limits are tested, they aren't conjectures. Ask any filesystem developer how many metadata operations per second can their program do, and they will likely be able to answer you in their sleep. This might be surprising on the consumer end of the deal, but to the developers there's nothing new here.