I recall reading somewhere (possibly the official motorola page for the X) that there is a near 'infinite' number of contacts and sms messages available.
I had probably 200+ in just one conversation alone, and saw no such popup. I also had the same thing on my old LG Voyager so I was expecting to see it too.
Tell ya the truth I clear it out every so often anyways as the conversation panned over a week and a half and was very big in terms of scrolling. No efficient way to scroll through other than swipe. So you'll probably end up clearing the convo's out anyways.