Well, at some point overcrowding is a problem, but up to that point, if the water quality is high the fish remain healthy and grow. As evidenced by breeders tanks with flow through systems not to mention the huge schools of fish in natural waters. Then again, in the average home aquarium, fewer fish is typically better.
This is where you, I and the Newbie would then differ.
I agree with what you're saying to a point, but would argue that there's more to the life of a fish than simple growth and that, for me, 'healthy' would include 'healthy' behaviours that are rarely, if ever, seen in breeder's tanks. Schools of fish in 'natural waters', whilst shoaling and schooling, do have more space to explore and, apparently, explore it they do. They can't do this in a breeder's tank and they can't behave naturally in a packed aquarium.
Obviously, our glass boxes are a long, long way from anything natural and my concern remains that it would be theoretically possible to really pack a tank, whilst keeping nitrate levels down to an acceptable level and, just because we can, doesn't mean to say that we should.
There's also that ethos of balance and, whilst balanced, everything seems to tick along nicely. However, the more finely balanced the system, the greater the risk of a cascading catastrophic collapse, should just one small thing go awry.