Yes, I've often thought we should have such a feature, but no one has ever asked for it.

I was thinking that that it would break them up alphabetically, for example, if you set your preferred maximum size to 30, and there were 100 bookmarks in a folder, it would break them up into four subfolders, say A-E,  F-L, M-R, and S-Z.  This is how I organize my personal bookmarks manually.  With this feature, the boundary letters would be automatically determined by the exact distribution of bookmark names.  Later, after 21 more bookmarks were added to these 100 so that 4 folders would no longer be enough, it would divide them up again, into 5 folders.

What do you think of that?