SQL Anywhere 17 - Database server connection limit exceeded
You need to use the dblic.exe utility to apply your licence key to the dbsrv17.lic file. See the docs for details.
Max connections is nothing to do with how your server is licenced. You could in theory set up thousands of connections from one network location, and that would use one licence - you want connections from lots of different network seats, so you need more licences. Alternatively you can buy a core based licence.