Uh... Yeah.... Dynamic range is the difference between full-bright and fully-dark. You can't get any more dark than "off", so you can only go brighter ... and you can't (or shouldn't) go over the device's maximum current rating on the bright-end.
16-bits (converted to decimal) gives you a range from 0 to 65,535. I'm sure you can't tell the brightness-difference difference between 0 and 1, between 65,534 and 65,535, or between 30,000 and 30,001, etc.!