I've got three shops - I sell jewelry, bags and purses, and soaps and lotions. That's a lot to put in one shop, because there aren't enough sections to separate all that out properly. I've had no problems with running three shops, unless you count the Crafter's ADD I've developed. :D But I think we all suffer from that.
It isn't easy, by any stretch, but somehow, it all works out for me. It's really up to you - for me, branding the stuff right was more important than number of listings in a shop. Etsy does not encourage more than one shop, and that's their business. What I do is my business, and I chose to separate everything out for MY sanity.
I mean, I've got over 100 listings in this shop, nearly 100 listings in the purse shop, and 335 listings in the jewelry shop. Can you imagine how awful that would look, all in one place? *shudder*