I don't have my experience using it, but my unit has two pattern generator boards grouped as a module. They appear as a single entry in the UI of the analyzer, and they effectively act as a single module with twice the number of outputs.
My assumption is that synchronization between modules requires them to be joined - they can be run at the same time without it, but, for example, could not use the same state clock unless externally attached to both, but there may be software benefits as well. A multi card module, since it's treated as one element, is probably easier to assign all of the inputs to a single bus for capture or analysis or export or whatnot. It could be that you can assign elements of the bus between multiple modules that aren't connected, but again since the synchronization may be required, it may not be possible.
The big disadvantage with the 16950 cards are that they use 90 pin pods, which only were around for a generation or so and are much more expensive to find on the used market. I believe they are differential until the connector, effectively, and then are single ended from there (though pairs of these can still operate in differential modes, I think it's 34 single ended or 17 differential from the pod itself on a single 90 pin connector). That said, the 16950 cards are also much faster than the 16700 series cards, with a 600MHz base state analysis speed. There are some 169xx series cards that offer even faster, up to 2GHz state measurements, but the cards beyond the 16950s have a minimum speed of 20MHz or so, so at least with the 16950s you can go really far down for legacy work.
I had just figured they populated the right number of RAM chips for the configuration, but it could be that they're software or hardware unlockable. I do know that if you make a multi-card module by connecting cards internally, it will operate at the memory capacity of the lowest card.