There are different timeouts.
The first you point out is a safety limit used in the initialization of the radio (when your Mote starts up). If the radio is not even installed or defective or doesn't respond, we don't want the library code to be stuck forever waiting for a response. The radio module should respond way sooner than the 50ms. If it doesn't we exit from that loop.
The next is a collision avoidance mechanism, it is 1000ms. If the library detects there is activity in the RF channel and can't send for more than 1000ms, it exits.
Then there are the ACK limits used in the sketches, these can be variable but usually no more than 30ms on average.
All these limits are chosen as to what is reasonable in each scenario.
