Having more than 32 nodes can have an impact on network performance. Since there are 254 possible node addresses on a LocalTalk network, using all possible node IDs will reduce network performance due to increased traffic.
The node addresses are divided up this way:
1 - 127 are user node IDs
128 - 254 are server node IDs
0 and 255 these two node IDs are reserved
From a traffic standpoint, only active nodes have an effect on performance. In addition, both active and non-active workstations affect the electrical characteristics of the network, because the LocalTalk connector box (transformer isolation) puts a load on the network, regardless of whether the workstation is on.
The document, "Inside AppleTalk", gives detailed technical information about AppleTalk and is available from Addison-Wesley Publishers.