A 7i76 has one encoder input and 5 step/dir outs, a 7i85s only has 4 encoder inputs, and 4 step/dir outs. That is only a total of 5 encoders. There would be a total of 9 step/dir outputs.
If you use step/dir output encoder feed back is not necessary. But it can add some advantages such as, the ability to use Halscope when tuning the servos, recovery from E-stop without requiring homing the machine (Linuxcnc can still track the position even when the servo drive is disabled), monitoring following errors within linuxcnc, and closing the position loop within Linuxcnc.
I thought that you were wanting to take advantage of all of the possible features your servo drives offer, one of those features is an encoder pass through.
The 50 pin headers on the FPGA cards don't actually even have 50 io points/header (there are actually only 24), but through a great deal of electronic trickery the daughter cards that connect to them can greatly expand their capability. For example the 7i76 card connects with a DB25 plug with 25 pins, but only 17 are actually for data. But the card has many more input/output connectors than just 17 (or even 25). The 7i76 has 5 differential pair step/dir outputs, thats 20 wires just there, plus a +5v and GND for each of those sets (10 more wires), 8 wires for the spindle encoder, 3 wires for the analog spindle command, 4 wires for spindle enable and dir, 6 wires for an RS422 connection, and 48 more digital IO points. That is nearly 100 possible wire connections serviced by a single 25 pin plug. (and possibly a lot more if a Smart serial expansion card is added)