What this FAQ does not cover is what the hell happens when you delete the tags. Depending on stuffs, there are like two options for user expectations for what happens when yous deletes tags.
Option 1, the user-friendly option, says that the 100 tags is a server-strain limiting option, so's the trained monkeys don't get tired or anything, and it's a floating limit; when you delete the tag from entry 1, entry 2 moves up, and so on down the line, and entry 100 becomes entry 99, and entry 101 that was not previously viewable becomes entry 100 and therefore viewable. This depends on the tag system depending either heavily on search, or mostly on indexing but using search when there are any changes made.
Option 2, the user-unfriendly option, says that the 100 tags is a list-limiting option, so's you don't have to have a st00pid hyuuuuge index for tags, and only list the 100 most recently added/edited tags. When a tagged entry is deleted/edited to remove the tag, the entry disappears from the index, but is not replaced. The index will begin collecting up to 100 of the recently added or edited posts with this tag ... when they're added or edited.
I've had to answer at least two Support requests about this undocumented "feature" of the tags system. I think it's bloody well time for me to document it, but I think that'll wait until I'm awake.
Note that I think that we would not be getting requests about "But it says I have XXX of $TAG but I was editing those tags because I have a st00pid hyuuuuge number of them and I can only see 100 of them and OMFG I RAN OUT OF TAGS but the masterlist of ALL TAGS says I've got XXX of them and yet WHERE ARE THEY ON MY BLOODY LIST plzkthx?" if it were Option 1. It's Option 2, folks. Option 2.