Now, way back when they were probably more using larger sized shot for larger birds (dove are about as small as is practical, and probably more useful for learning real wing shooting), but that gives you an idea of the scale. If you go up to #6 for pheasant and grouse sized birds, 1 oz is 219 pellets.
And, yeah, this is a very cool hack for cheaply making this stuff, which we do indeed use in mass quantities.
It's conceptually simple and produced great results. I agree that it might not be the most effective solution there is, but it seems like it was the most effective at the time (which is why they were used).
Perhaps you mean efficient rather than effective? It does seem to be quite effective, despite the superficially amusing fact that a very tall tower is being used to form a very small product.
Though whether it's inefficient in any other sense is, I think, open to question: The up front expense and difficulty of the tower is a one-time cost, and I'd think maintenance on it would be fairly minimal. I'd think other methods discussed in these comments would almost certainly incur significantly more overhead, particularly over the life of the facility.