I did some math and you're clearly right. I think I imagined that with driver-less vehicles leaving much more frequently (10s per minute) one could catch up to the capacity of a small light rail system but that's clearly not the case. I had imagined that _maybe_ it could be an approach for a lower capacity system in the future.
My math as someone who is not knowledgeable in how to get this data is as follows:
In Seattle is running 4 car trains at 8 minute headways at peak which works out to 7500 people per hour at crush load (4 cars, 250 people per car, 7.5 times per hour). This would require 125 vehicles with 5 seats leaving every minute which is clearly impossible.
Looking at Portland's MAX, it looks like they often run 2 car service with 160 passengers of capacity each with service every 15 minutes so 1280 people per hour (2 cars, 160 per car, 4 services per hour).
1280 people per hour could be served by a 5 seat vehicle leaving every ~15 seconds. This I suppose is what I had expected would happen when I tried to imagine the best case scenario for this service.