Personally, I think websites should fill up the available space, increasing font size if it makes sense, perhaps using resizing images. So, no - text should not be constrained to a maximum width. If width were a problem, billboards wouldn’t be a thing.
Billboards are meant to be read from far away. So even though the physical width is large, we perceive it to be much smaller. Maybe similar to a big banner on a Desktop monitor.
Imagine reading the billboard at a much closer distance, say 2 meter. You'll have to move your neck from left to right. It doesn't matter how big or small the font size is.
As a subjective test, I lowered the font size of a random article to see if I would have trouble reading it. Other than having to focus more to make out the text, I don't have problems reading the entire paragraph. On the other hand, removing the max width made it more uncomfortable to read.
So the distance from where the text will be viewed from is an important factor to take into account. Phones, Desktops & Banners all are viewed from different distances.
I guess not.
> there’s a difference between number of characters and width
Billboards use large letters to fill the space, but normally they would be readable on a business card.
You seem to suggest that fontsize should adapt to width to fill the space (seemingly to a billboard, as per your example).
If the billboard technique was used on the web, I guess we might not have more than a handful of lines on screen (on a 16:10 or so). That would disable skimming on long texts and even more, barely display a single paragraph (that's a gut guessing).
Plus, and more importantly, the distance to the screen is such that a font too big is not more readable. There's a tradeoff to he found for the fontsize that not only has to take into account the size of the screen but also the distance of the reader from the medium.
Or so I assume.