There is no hard limit to the number of tunnels it will build. The numbers are based on lab testing and are recommendations. Actual performance will vary per situation.
In a similar way there is a recommendation for no more than 500 clients behind an MX100. /21 could have 2000+ clients so it might suffer, yes. It might also just work, it all depends on what they're doing.
Note that It will display a warning if you use the DHCP server functionality and a subnet larger than /19 and it will do so each time you "Save settings":
![warning_DHCP_size.PNG warning_DHCP_size.PNG](https://community.meraki.com/t5/image/serverpage/image-id/5810i269FEE66D6F48490/image-size/large?v=v2&px=999)
Confirming that means that you'll effectively use the larger subnet, but the DHCP server will probably only hand out addresses from a smaller /19 pool. No issues with that apart from the fact that you'll likely have a large part of your subnet unused.