How exactly do you set it? Could you copy'n'paste command and output?
The smallest possible file on NetApp is 4K, so you should be able to set number of files to number of 4K blocks which is around 268,435,456 for 1TB volume. I have customers with more than 50M files in a volume.
You can't access volume via FCP/iSCSI. If you have license, you can create LUN though.
You can use the maxfiles command to query the current maximum files settings and to modify it. E.g. "maxfiles <volume> <maximum number of files>". But the default maxfiles of a 1 TB volume should already be more than enough to store less than 3 million files.
But perhaps you are hitting the maxdirsize instead of the maxfiles limit. If you do this will logged to the the message file of your controller.