The folders in Google's stock Google Now Launcher are currently restricted to just 16 entries (four rows of four). That's going to change very soon. The version of GNL that ships with the Android M preview has folders that automatically paginate when you add more than 16 apps. How many pages can you have? I'm not sure as I have yet to hit the limit.
The folders look the same as before when you've got a single page of apps, but as soon as you bump it over to the second page, the folder name shifts to the left and a page indicator appears in the lower right. These pages scroll left to right, which is a little odd when you consider the new app drawer and widget picker are vertical scrolls now.
I have yet to find a limit to how many pages you can have in the new folders. I even added every single app on the phone to a folder (six pages), which sort of makes it a horizontal app drawer. Okay, not really. Assuming Google decides to move forward with this and other GNL changes, we should have an official updated version for pre-M devices before too long.