Thank you for sharing your experience and pushing the iPad to the limit. We are fully aware of these limits and try to come up with a solution in the future.
When the maximum number of layers in a session is reached, the layer area becomes very crowded and it´s nearly impossible to select a layer in the layer area. You need to group layers together to make some space again. Especially in multiplayer sessions this limit is reached very soon.
There is also a technical limit per layer how many paint strokes or eraser strokes you can do. The more fingers you use the faster you reach it. Than a new layer is created automatically. Editing this layer only works if you start rewinding it.
Switching apps is also very dangerous with very complex scenes due to memory allocation of other apps.
If you want to do very complex scenes with a lot of content you reach the limit of an iPad´s hardware very soon. In the future we want to use laptops and PCs again to handle these limitations.
Hope i could answer some questions.