Hi and sorry for this long delay! I was on a vacation the past couple of weeks and wasn’t able to reply earlier.
In general, the script should handle large lists just fine – it’s designed so that the performance depends as little as possible on the size of the unordered list. Here is a quick demo:
http://jsfiddle.net/4gscz846/1/
Here is another thread that covers performance with large lists:
http://www.smartmenus.org/forums/topic/very-large-menu/
That being said, I noticed you are now not using the SmartMenus plugin on the demo page you posted so, unfortunately, I can’t really check it and possibly suggest any optimizations in your specific case.
Please let me know if you still need any input.