While I have not used this setting, I think if you set Maximum uploaded file size in Admin/Security/Site policies to "Server Limit" as apposed to a specific limit, you will only be limited to the PHP/Web Server limitations (in php.ini etc.).
However that is likely to be the default so the real reason that you are limited to 16MB is likely to be that you have the setting "upload_max_filesize = 16M" in your php.ini
Alan.