Both controls - RadUpload for Silverlight and RadUpload for ASP.NET AJAX don't include any limitations to the maximum number of files that can be selected. This is why this is probably a browser-related or framework-related limitation.
You can reproduce this issue outside the RadUpload controls - for example in Silverlight you can try opening the files through an OpenFileDialog dialog. The RadUpload for Silverlight uses this class to open the files and has no control over its behavior with so many files.
the Telerik team