Could someone use 1 parent material and then 100 instances which would be quite varied?
Do materials data get stored in the GPU’s VRAM? If so, with proper use of instancing, about how many do you think could fit in a decent GPU 1-2GB GPU before it starts to choke up?
My guess is that it had a bunch of textures loaded into memory which can run out of memory space if you have a lot. That will depend on how high the texture resolution is.
You could run into a problem if you have 240 materials in the same folder. What I found though is not all assets are loaded into memory and a low resolution proxy is load in for visual purposes. Smart.
I also found that if you grab the asset and giggle it a bit or open the asset in an editor UE4 then loads the asset in full and looks proper.