Whenever you have more than 4 services, they are put in a dropdown option "Services" on right click instead of just being added to the right click menu itself.
Is this an option somewhere that can be changed?
The little known Apple Services Manager, released via Mac OS X Automation, offers such a setting (bottom right of the main window), besides other service amenities like fine grained control over which service actually turns up in the menu.
Services Manager seems to just modify .GlobalPreferences.plist:
You have to reopen applications to apply the changes.