I just confirmed that not only does it result in "result::failure" if the manifest.mf is above about 1MB, but even with smaller manifests it doesn't really work.
I created a subfolder with between 1500 and 3000 files (one byte long) each with a 205-character filename. This resulted in manifest.mf sizes between 527680 bytes and 1054180 bytes. With the smallest one, the package could upload correctly ("result::success"). At 2500 files (manifest size 878680 bytes) it gave "result::" with no success or failure report. At 3000 files it reported "result::failure" consistently.
The thing is, even with "only" 1500 files, once the package uploaded the application would not start. Rather, I think it gets launched, but it never opens onscreen. All that happens is the app icon area slides down to show the "shuttle bar" (I think it's called that) and nothing. You can't launch any other app at that point either. It's either corrupted the system in some way, or some process is blocked trying to launch the app but it's taking too long to load (20 minutes and counting) or has died. The only process taking any CPU is pid #1. (Oh, and "pidin" shows that /sbin/launcher has died, so things are really kaput.)
So, word to the wise, there are some undocumented system limits and you should definitely not add hundreds of files to your .bar package or you risk problems.
