Completely agree, we need players spread out more. Personally I can't play in 32 player servers very well because of my framerate, but even aside from that the servers usually don't handle it well either. Towards the late game hits stop registering all over the place. The other day I traded AC20 fire between my Demolisher and an enemy's for 1-2 minutes with no damage to either of us, and another time I expended about 3 tons of MRM40 ammo from a Mauler D with no hits registered.
I prefer below 20 myself, but 24 would probably be a good round number. This was the maximum before 0.4, was it not?