Why is open collector output is called high impedance and what determines the upper limit of the pull-up resistor?
An open-collector output can be thought of as a switch connected to ground. When the switch is open, it has a high impedance. When the switch is closed, it has a low impedance.

So, when the transistor is conducting, the output is low, and it can sink current from whatever the load is, limited by the ratings of the transistor. But when the transistor is cut off, the output is high, and any current supplied comes through the pullup resistor.

The pullup resistor must be selected to meet the needs of the load. Current through the pullup also adds to the current through the transistor when it is on, so you mustn't overload it &mdash; but this is rarely an issue.