Oregon only has a little over 4 million people; half a million evacuated means 10% of the state is out of their homes. Even if only a small proportion of them actually burn we're looking at a serious housing crisis.
Basically the 500,000 people was all the people in any sort of evacuation preparation zone. That includes everyone in a level 1 evacuation zone. That's the be ready level. There have been less than 100,000 people actually evacuated in a level 3 zone according to the press conference. That's still a lot of people, but not as many as had been reported. It's still horrific for everyone that's been displaced.