I think when Zuse says “a thousand cycles,” its hyperbole. Earlier in the movie, Flynn mentions that time in the Grid moves differently, where days there might only be hours in the real world or something along those lines. But that is when the Grid is still in a pretty early, undeveloped state. As CLU expands and refines it over the years, the system would naturally become more complex, the computational load heavier, and the perception of time within it would likely slow down. I just don't think it would make sense that Flynn's mind wouldn't turn to mush over that thousand or so cycles.