You may only use 5 * YOUR_LEVEL + 5 mobs when fighting.
So if you are lvl 100, you may use 5 * 100 + 5 mobs. Which is 505. Even if you have recruited 2000 mobs, you can only use as many as your level permits you to.
//Formidable - DeathWish MGS
When I fight (I am level 69) I have 420 members that show up with 2 mercs. According to my math it should be 350 plus 2 mercs). This changed happen last week and I have no idea why it changed.