Idea Summary
Faceted search (FS) and smart filters (SF) are limited to an arbitrary number of items (4000 as of writing, the documentation should be updated soonish). The idea is that there are situations when this limit doesn't or shouldn't apply. For instance, in the documentation they show faceted search filtering a list of projects. A large company could easily have more than 4000 tasks or projects over it's lifetime. The example data in APEX typically use employees and departments, and plenty of companies have more than 4000 employees.

Faceted Search Documentation, under section 8.7.6.5b in a warning box
Smart Filter Documentation, under section 8.6.6.4b
Use Case
The reason a limit is implemented is to provide a "useful faceted search UI". There are legitimate use cases where I've set cascading facets or other filters where the project might need to filter more than 4000 items. In this case, the builder should allow a developer to bypass the arbitrary limit and take responsibility for the chance of a poor user experience.
Preferred Solution (Optional)
A few ideas here, but open to other suggestions.
- "Advanced" setting to bypass the limit on the faceted search region on a per region basis
- Application user interface setting to remove any arbitrary limits like this
- No settings changes, but show a warning when on the site in a developer view stating the experience may be degraded by the amount of items returned