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Are there dangers to National Morale that would risk civil unrest if a large percentage of the population is called to the colors? If so, are these risks reduced if you are able to call a Levee-en-masse? Other than money, what are the limiting factors that keep a player from recruiting every 16-60 year old provincial he can grab?

'Recruiting' as such is really just adding to the Draft Pool. The Draft Pool functions as a replacement depot for depleted units, but units are not created wholesale out of the Draft Pool. You still have to create the units using the usual 'purchase' prodcedure which involves expending various resources (depending on unit type) and waiting a certain amount of time (depending on unit type and various province upgrades).

Note that building units depletes your population points (ie, Manpower), but not your Draft Pool.

That has been my experience anyways. [;)]

Uncle_Joe is completely right in what he says. But I will add some more detail.

So to split your question into two pieces:
a) "Why not have the reinforcement pool as big as possible?" - Firstly, because the resulting morale will be very low. Secondly, because you pay for the 'draft size', and there are better ways to spend money. Thirdly, because you probably won't have vacancies for all those recruits when they finish their training. Fourthly, because it reduces the available population for economic productivity, so things like food production will go down. Oh - and did I mention because the morale will be very low?
b) "Why not recruit as many divisions as possible?" - Firstly, divisions take resources to build - even militia divisions take a bit of labour. Secondly, each division recruited reduces the population, which means that the province/country is less productive (and less able to support military units with supply and upkeep). Thirdly, because you can only fit so many divisions into your corps and armies (which are expensive and time consuming to build) - divisions outside those units are really only useful as garrisons, not in combat.

It is easily possible to wreck your national economy in COG - this is one of the ways you can do it. And when your economy is wrecked, there are national morale repurcussions. But there is no direct link between recruiting policy and national morale.

Levee en Masse is available to all countries (although France starts with it), and it on my list of "must have" improvements.

Thanks both of you for your detailed and informative info.