I would assume that's what 359b means. I heard the dean wasn't supportive up until a couple of years ago, but that could be wrong.
But just looking at what's happened from the outside, it's not so clear-cut. It's not like NYU or Duke (department gets lots of resources) or Wisconsin or Chicago (where they don't). Princeton does seem like they are regularly hiring at the junior level (Monk, Stewart, Frye, Goldstein) and they do have a line this year, so it's not like they're not getting any support right now. They're also just starting to get support for poaching some big names. IDK what to make of that.
"Seems like their bigger problem is that the department is not giving them room to expand."
Did you mean dean or college? Departments don't typically have control over their size.