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The number of libraries is not limited. You can open a library by path using switch/create library.
The number of libraries shown in the pick lists does seem to be limited to 25, from what I see in the code. I can safely say that this won't change.
I must ask: why would you want to organize things in the way you describe? A library per author's initial is very strange. What will you do with books that have more than one author? What will you do for series that have books by different authors? How could you find a book for which you know the title but not the author? How can you find all books in a particular genre other than the ones you seem to have chosen? How do you find all books by an author who writes both biographies and whatever other genre you decide to create?
If you really want to organize things that way, my strong suspicion is that calibre is not the program for you. It seem that you are trying to emulate a folder hierarchy, and calibre doesn't help with that. Calibre was designed to have one library, and it works best in that mode. You can make virtual sub-libraries on demand using search restrictions that enforce whatever criteria you want.
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