To me, literate roleplay always meant posts with good grammar and sentence structure. I never thought of literate roleplay requiring a specified length. As long as your one or two sentences were grammatically sound, I considered that to be literate. I have no idea where this whole fiasco with assigning post lengths to terms like "Illiterate" "Literate" and "Semi-Literate" came from. It's quite ludicrous too; just because someone doesn't write two whole paragraphs doesn't mean they can't read or write.
I can understand the general connotation that probably influenced the rise of these terms, but I still think that they should be changed. Beginner, Intermediate, Advanced, and Expert are not only more appropriate, but also bring less judgement upon those who are labeled with these terms.
Back when I was more involved with roleplaying in FeralHeart (this was about two and a half years ago), I used to join mostly Semi-Literate roleplays. They consisted of one or two "paragraphs" (a paragraph being the whole box filled in). Now usually that's a bit much for me, but the real problem started when i joined a Literate group. The quota was three paragraphs minimum per person. So, the whole thing was about as fast as a snail; it took us an hour just to describe our characters traveling as a pack across Fluorite.
And I noticed something rather interesting too. In order to keep up and not slow everyone else down, I would pre-write my first paragraph while other people were still typing their second or third one. This allowed me to think through and decide on what my character's action would be and how to drag that out into three paragraphs. And funnily enough, I wasn't the only one doing it either. The only problem occurred if someone decided to add in an unexpected turn of events in their last few lines.
Because everyone was writing their first paragraphs ahead of time, it meant that our characters weren't genuinely reacting to what had just happened, but were rather reacting to what had happened earlier (as in, five minutes earlier to be precise). So, if someone decided to say... make their character maul someone else, then we'd get a whole paragraph describing what the other character was doing before getting mauled, which is counterproductive, since they already described a similar scene from their last paragraph.
Anyways, the whole thing was a mess and I didn't like it at all. After about a week of not getting anywhere story-wise, I dropped the group.
In my opinion, having these line quotas is absolutely ridiculous, because then you have people pre-typing their paragraphs in order to avoid slowing others down. The roleplay is lackluster, because we learned to expect that the first paragraph anyone will type out is not going to move the plot forward and honestly, half the things that were being described could have been tastefully said in two or three sentences.
Not to mention the prevalence that wolfspeak had in these groups. Not using proper terms and having to rely on connotation was not a good time for me.
I've met a lot of people who I've enjoyed roleplaying with, and who don't mind writing two or three sentences, yet I haven't met a lot of groups who could say the same. That's mainly the reason I enjoy one-on-one and spontaneous roleplay without a group. I've just learned to expect that groups will naturally be stricter and more confined than individuals.
Of course, this is just my take on all of this, so it's possible that my experience hasn't been anything like someone else's.