Unfortunately, it's right there in the docs, my friend. And your error is self-explanatory. Hard limit is 4096 (for MyISAM), or 1000 (for InnoDB), but EE defaults to MyISAM. The functional limit is actually less:
This is why FreeForm, upon going from 3.x to 4.x, switched from having one table with expanding columns when adding forms, to giving each form it's own table. If Devdemon Forms does it's job correctly, when you delete old forms, this should delete the field ids for those forms. I don't know, I haven't personally used Devdemon Forms. But try it; remove some old forms, or specifically (if Forms doesn't directly relate forms owning specific fields) remove fields from your Devdemon install. Check the docs for how to do this.