The truth is there is no reason you can't have both.If you play harem games like I do, you probably noticed that you can find three types of games:
1) Those games with 40 girls where you have like two H-scene with each girl at most and not so much story development.
2) Those games with 4-5 girls at most, when you know every single detail of her and you already did every pose in the Kamasutra with each girl. Twice.
3) Those games in the middle.
Thing is, some player wants "more harem" than those 4-5 girls and some player wants less girls and spend more time with each girl. The option 1) works better for those game going for the quick fap and the option 2) works better for games who tries to develop a story and characters.
So the question is, having in mind both things and trying to make a balance, how many girls do you think are the right amount of girls for a harem game?
I'm going to use Skyrim as an example then something I'm working on.
Skyrim is a game with a lot of expand-ability.
You can add in new stories, new characters, you can change the bodies, add in new animations, and more.
Frankly, there is next to nothing from stopping you from creating an entirely different game with it if you chose to do the work.
You could change all the assets even land and make the game in a modern city. Change all the clothing and so on.
There isn't much preventing you from creating 1,2,3,5,10,20,40, or 100 girls with high amounts of detail to their stories.
There isn't even an issue in being able to tie the women together in a harem and have them act like they know each other and so on.
The problem comes down to the amount of time it takes to do that. So when you create a game with 5 characters you have more time to spend working on each individual character and then their interactions and connections in the story.
character personality and relation engine:
So you have your base AI it creates a database of relationships between people the person has met in their life time.
It simply tracks various levels regarding the relationship. Such as how the person feels toward the other person.
Based on that it adjust the levels by which it interacts with the person in that relationship.
You then have a set of modifiable and expandable routines. Maybe, the person isn't liked very much so the girl always find some way to berate the person or cause them problems when they see one another. It would be easy to create enough variety in it that it wouldn't repeat in the game but would still fall in nature. But maybe you want it to repeat because that's the way the person is or the relationship works. You know like the person who always calls another person by a name they don't like because they know it gets under their skin.
Anyway by having such a system you can then focus on the primary story interactions and not have to deal with any of that filler. That filler is just one thing that eats a lot of development time.
It also allows you to add girls in the way you would simply add expansions to a game. You can focus on writing a plot around them and the primary interactions.
This means the guy who wants only a few girls could have those in the game and no suffer a loss of detail and involvement with them and the guy who wants a lot of girls also can get what he wants.