From the documentation (https://developer.garmin.com/connect-iq/core-topics/app-settings/) the maxLength attribute should work for a string setting like this one:
<settings>
<setting propertyKey="@Properties.LC" title="@Strings.LC">
<settingConfig type="alphaNumeric" maxLength="100000" />
</setting>
</settings>
On Garmin Express Mac (version 7.4.1.0) the maximum length of a string setting is always 256 characters no matter what maxLength attribute is set to. In other settings editors (Garmin Express Windows, Garmin Connect Mobile Android and Garmin Connect Mobile iOS) the maxLength attribute seems to be working properly as I was able to set a string with more than thousand characters when testing them.