That did surprise me O_o. I can't see a reason for why they changed the limit, but it simply exists because objects are stored in a container that only allocated memory for 400 on-screen objects. Sometimes, you can exceed the limit by a number or two, but this will often cause random behaviors.
A-Engine: A new beat em up game engine inspired by LF2. Coming soon
A-Engine Dev Blog - Update #8: Timeout