Is there some sort of ceiling for detail in VRchat? Because I notice a lot of people going with minimalist and toony styles more than anything else.

Probably aesthetic choice, given some folks had taken the rather high detail Monster Hunter World characters / monsters then Avatar'ifying them and they work just fine.
But when it comes to handmade stuff, yeah minimalistic and stylized seem the most common - probably a lot easier and quicker to make as well?

I suppose. I'm woefully ignorant of the -how- and -what- goes into it.

There's also load limits - a highly detailed model will take long to load for users and others in a lobby, so it's an optimization angle there.

True!

Cool. Follow your muse!