Certainly not restricted to 5 (not sure if there is an upper limit). I have 20 running at once in one of our data centres. Are the proxies all enabled for the groups / data stores?
The number of proxy can be deployed is more than 5. So, It is not a limitation issue. Suggest you to check the abnormal proxy again.
Please refer to following thread:
Number of Proxies
Hope this helps!
There is a limitation on the Vcenter session setting. For example; version 4.1 Vcenter supports up to 30 sessions. So if you deploy more than 30 proxy, you will not be able to use in same time. with 5.1 Vcenter, the limit had been up to 100 sessions. If your avamar version is 7.x, 1 proxy can open 8 session.
Shortly you can deploy more than 5 proxy. If you trust your vcenter can handle this and avamar version is 7.x , you can open 90-100 sessions. If you don't trust your vcenter to handle more than 50 sessions, you should not deploy more than 5 proxy.