I wrote about Linux mkdosfs on a 1440K floppy:
It doesn't say anything about what the upper limit
might be.
It appears that the practical upper bound is 2694 directory entries,
which leaves 2694 clusters available for allocation to files. Any more
directory entries, and you wind up with fewer clusters than directory
entries, thus you can't have all of the directory entries actually in
use for non-zero-length files.
On the other hand, due to the volume label, and the use of multiple
directory entries to represent long file names, more than 2694 directory
entries might actually be useful.
I can't really imagine why anyone would want that many files in a single
root directory on a floppy disk, though.
Eric