Ok, Ive been hitting the net hard and finally found the key to locating info I wanted, thanks to the US based Toyota Highlander website in the end... yeah, who knew?!
So, the info/specs about how many folders and how many files is actually not in the USB section, its in the Tips section... just after the info about what iphones work with the ICE in the 'Operating' section
I was looking for the generic location as I assume that the manuals are device / country specific and pages and section numbering would differ. I felt that if i could find the generic place that Toyota chose to locate the info then others who come along later would be able to do the same, no matter where they are based, as the info would follow the same order in the books for our cars.
Anyway, the USB info might be the same for all this era Toyotas, but it might differ for you... for me, with my Aus Rallye, the USB info is:
USB 2.0 480mbps
FAT16/32
Max Folders 3000
Max Files 9999
Files Per folder 255
Max nested Folder layers 8, recommended is 2
What is interesting is that if i read this right, if you attach a USB hub you can increase these limits as it will 'see' a 2nd card (youre still limited per card of course to the above maximums). However, dont get too excited... Only two tho, not more.