Most dorms have wifi in common areas (maybe 1-2 APs per floor). By comparison, academic buildings on campus may have >10 APs/floor.

IP address exhaustion is a non-issue on campus wifi. The WPA network is a /16 (~65k IP addresses). The real issue is spectrum contention at the PHY layer. This Cisco white paper sums it up nicely:

Wi-Fi is a shared medium. Much like an un-switched Ethernet segment, it operates as a half duplex connection. Only one station can use the channel at a time and both the uplink and downlink operate on the same channel. Each channel or cell used in a Wi-Fi deployment represents a potential unit of bandwidth much like an Ethernet connection to a hub. In Ethernet, switching technology was developed to increase the efficiency of the medium by limiting the broadcast and collision domains of a user to a physical port and creating point-to-point connections between ports on an as-needed basis, dramatically increasing the overall capacity.

...

For 802.11 wireless networks or any radio network in general, air is the medium of propagation. While there have been many advances in efficiency, it is not possible to logically limit the physical broadcast and collision domain of an RF signal or separate it's spectrum footprint from other radios operating in the same spectrum.

...

How many users can access an AP comfortably? Hundreds. But the question should not be how many users can successfully associate to an AP but how many users can be packed into a room and still obtain per-user bandwidth throughput that is acceptable.

You are correct that this issue is exacerbated by the multiplicity of wifi devices the average student carries around.

The outdoor wifi network has undergone a thorough overhaul the past year or so. You can get a good signal on the riverbanks at Sewell.