The maximum number of extents is 254-256 irrc and has been for awhile.
Sometimes very large tablespaces, even partitioned, need to go into
several extents e.g. a history table with a large varchar field that
tracks every event for every policy for a multi-billion dollar
insurance company over the course of the last 100 years. You can't
always get what you need in the primary and need a large amount of
secondary space.

A friend of mine from another v7 z/os site queried his catalogues and
was unable to find a value higher than 131068. Is this the real v7
z/os limit?

A catalogue query from my first note:
select dbname, tsname, pqty*4, sqty*4 from sysibm.systablepart where
dbname='TESTDB' and tsname='TESTTS';