Since I personally answer 90% of the posts in here, things may take a little time sometimes. Especially if I am to focus on future developments also once in a while.
The slideshow does cache a few images, but this is unrelated to the amount of images in the folder. The cache setting can be found in your slideshow config file:
However, there is still a big difference between 5000 images and 100 images. The slideshow has to load a list(XML file) of all 5000 images along with filesize, serverdate and dimension attributes. Not only does this take quite some time to load, but it also takes some time for Imagevue to swallow(parse) the XML data once loaded.
The conclusion is that there is no physical limit as to how many images you can put in one and same folder, but it certainly takes longer time to initiate because it has to load the entire list.