Each instance holds 32 players at a time, but instances are connected together so a single system can technically hold all of the players in the game. You wouldn't be able to see them all at once, but you'd see a mix of them as you switched between instances.
The servers use cloud technology to hand the players off between servers behind the scenes, and you're not just on one server: they seem to have separate virtual servers for matchmaking, transactions, and so on.