If the max-size feature is a compile option, it's not mentioned in ./configure --help as such. If it's just supposed to be there, well, the option is accepted on the command line, but it's not effective. Invoking rsync with "--max-size=1m" on a directory with a 16g file in it and nothing else, it hangs there on the 16g file - probably transferring it, but it should have just said "No, this is too big," and finished, right?
So either the bug is that max-size needs to be documented in all the obvious places as an optional feature not in the default configuration (if that's the case), or it looks not to be working in 3.0.7.
--max-size works just fine for me:
$ rsync --version
rsync version 3.0.7 protocol version 30
$ mkdir src dest
$ truncate -s 16G src/gigantic
$ rsync -vv --max-size=1m src/gigantic dest/
delta-transmission disabled for local transfer or --whole-file
gigantic is over max-size
total: matches=0 hash_hits=0 false_alarms=0 data=0
sent 31 bytes received 12 bytes 86.00 bytes/sec
total size is 17179869184 speedup is 399531841.49
Are you doing something different?
If there are more details, feel free to add them. But this seems to be working fine.