Its nothing to do with bandwidth
It's merely to keep the visual flow of the forum. Like matty says, if we have signatures showing on every single post, then the posts can easily become lost inbetween signatures.
I used to frequent the Delphi forums alot a few years ago, and they were a perfect example of this, every post had a signature, and they didn't limit it either, so you ended up with sometimes 1 or 2 posts per page, and it took an age to scroll through a few posts.
It's also partly to do with SEO (Search Engine Optimisation). The more outbound links we have (especially if they're irrelevant), it can affect our search engine rankings, so rather than have signatures turned off, or restrict what people can put in them, we just limit the amount of times they show.
We also get spammers putting a link to their site (Nothing to do with photography) in their signature, then going round posting very small but topical replies (Like matty said), as a way of getting exposure all over the forum. So the word count rule is a way round that.
We can't please everyone, but if we turned signatures off, then people would complain. If we allowed a free for all on signatures, then people would find it difficult reading the forum and would just end up going elsewhere.
This way, we try and have a healthy balance