I believe the limitation is only on Kindle devices. The Kindle apps can show more.
I cannot be certain (I don’t have any collections nearly this large to check any more) but I think you can still add/remove individual books from a collection, you just cannot list all of the books in a collection on your Kindle if it has more than 1000 books in it.
Also performance in adding/removing on Kindle is pretty bad once you get above several hundred books in it (unless they have fixed this in the recent updates). It can take a minute or more.
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