Is there a limit to the amount of photos and videos in the Photos Library App

There are several possible reasons why Photos may be slow, when you open your Photos Library.

• If you just recently upgraded to Catalina Photos may still be upgrading the library. This can take a few weeks until Photos is back to normal for a library as large as yours.
• You may still have legacy media on your Photos Library, that Photos can no longer handle after the upgrade. Some codecs have been deprecated by the Catalina upgrade and Photos can no longer process some video formats or image formats that used to be supported by the earlier system versions. For example, you should remove all PDF files from the library. (How to Weed out Legacy Media in Photos for Mac - Apple Community)
• If your photos are in a RAW format, photos may be slow, if the RAW processing has changed. My Mac is currently slow as molasses, when I try to edit the DNG files in my library, because Photos is reprocessing them with the updated RAW support.
• Photos needs a lot of free storage in addition to the size of the Photos Library itself. The storage needs to be free, not just available. You may want to check with Disk Utility, as the Finder is only showing "available" storage, not the unused storage. How much storage is free on your system volume and the volume with your Photos Library? On my Mac with the least storage Photos is unbearably slow, if the free storage is dropping below 40GB, even if the Finder is showing 100GB available, but it looks like the system will not purge the the storage to free it immediately, if needed. (This will probably depend on the size of the library. My library has currently 55000 photos and 300 videos). Most of the "available" storage may need purging, and that does not always seem to work.
• Photos may be a bit slower, if your image files are huge, for example large RAW files or TIFF files. When I am working with huge TIFFs, larger than 100 MB, Photos is beach balling a lot.
• Photos may be slow, if you have hundred of smart albums, that need to scan the whole library for updating. In a large library I would be frugal with smart albums and delete the smart albums I do not need continually.
• Are you using iCloud Photos? During the past week Photos has been very slow on one of my Macs, where I am using an optimised iCloud Photos Library. It took very long to download the originals from Apple's cloud servers.

As far as I can tell, the size of Photos Library matters, for several reasons:

• The larger the library, the harder it will be to maintain it: Updating the library, repairing the library, backing it up, moving it to a new drive. The background processes after an upgrade will take considerably longer for a large library.
• And you need more additional free disk storage as working storage, when repairing the library or syncing it with iCloud.
• Processes searching the whole library may take longer, like smart albums.
• Some parts of the user interface in Photos have not been designed with a large library in mind. The People album cannot be sorted automatically or structured in any way, and with nearly thousand of named people it is barely usable. The list of keywords is just a flat list, and the more keywords we define, the harder it will get tu use them.

I would not let a Photos library become larger than it needs to be, to make it easier to maintain it. We need all photos and videos together in one library, that we need to use together. But if we can split the library thematically into separate sets of related items, we should do it, for example separate private photos from work related photos. I have archive libraries with all photos for each year, and a system photo library with all photos over the years to sync with all devices, but only the favourites.

The architecture of the Photos library is said to be capable of managing a million items, given enough resources (such as storage, memory, and CPU). I have somewhat more items in my Photos library, and my 27" 5K iMac handles it just fine.

Yes, you can have two or more Photos library on the same Mac user account and switch among them. You cannot have more than one open at a time, and only one can be the System Photo Library, allowing connection to iCloud and access through the Media Browser.

You can find out if you currently have enough space available on your iMac by choosing About This Mac from the Apple menu, then clicking the "Storage" tab. You would like to see a substantial amount available (shown as the dark area at the right end of the bar graph); 20% or more available would be plenty.

My opinion is that 8GB of RAM and the use of a Fusion drive are some underlying reasons you're experiencing poor performance with a large library.

27" 5K iMacs can have the RAM upgraded fairly easily. The hardest part is pushing that darn button to pop open the cover to the memory slots.

That Fusion drive is a different story. Depending on which model year you have, upgrading the internal drive may not be possible but I think any 27" with a Fusion can be upgraded albeit with some difficulty involving removing the screen and some internal components - best left to the pros.

But, you don't have to get an internal drive upgrade. You could do what I did which is get an external SSD. My Fusion drive was really frustrating me with my 700 GB photo library so I bought a 2 TB Samsung T5. Sandisk also makes a really good external SSD - the Sandisk Extreme Portable. Drive performance is easily 10x faster even over USB 3 than the internal Fusion drive. If you want to take performance up another notch, you could get a Thunderbolt SSD but they get pretty pricey. A 1 TB Samsung or Sandisk USB 3 SSD runs about $150. A Thunderbolt version would probably be about double or more that price.

I think these upgrades would improve your experience. You seem to have plenty of free space on your Fusion drive but it's just not living up to your expectations.