In the 90s, people thought about the c10k problem, which is how to handle 10000 connections.
In those days, this 2GB server would have been a dream to have and probably had moved the needle to 20k, 50k or whatever the limit is. You only get problems with 500 connections on a modern machine if you are really really bad at handling each request.
You are right, the server handled connections fine. The issue was a single unindexed correlated subquery blocking the entire PostgreSQL connection pool for 13 minutes. We live and learn.
Yes, did not mean to imply that everyone should know everything immediately, just that "the server was too small" feels a bit misguided. It might solve the problem to make the hw a real monster, but if you hit limits at 500 then I think one should look at the other parts of the equation. Glad you fixed it in the end.
In those days, this 2GB server would have been a dream to have and probably had moved the needle to 20k, 50k or whatever the limit is. You only get problems with 500 connections on a modern machine if you are really really bad at handling each request.