Vlad,
I grant you that 2^32 is the binary theoretical limit. A directory tree of 100 levels would fail in pure recursion, however a directory tree can be processed in a LOOP as well as using recursion.
At one of the Devcons in the past Calvin Hsia wrote a recirsive routine that navigated a directory structure and it went well beyond 100 levels through some very ellegant coding. I am no where near the programmer that Calvin is so I won't even try to recall exactly how he did it, but it was in front of a packed room.