Your quick and enviable ability to search out, read and retain information, and ask logical and pertinent questions really impresses me, Corey.
Yes, stressed out lily bulbs do tend to divide prematurely, that is, at a smaller size than they normally would. In fact I had such a problem myself with some lilies in a garden that I converted over a few years to more of a dryland garden.
When I used to grow "normal" plants in that garden that required moisture - tomatoes, peppers, regular flowers, fun stuff like broom corn, amaranth, asparagus beans, etc., I watered regularly. This is a garden with excellent drainage. The two asiatic types of lilies in question grew well, with stems having a consistent 8-15 flowers each. But over several years, I began replacing the space with dryland plants - species penstemons, central Asian species bearded iris, plants native to the dry sides of the mountains and western prairies. So watering had become less frequent to none.
Through the transition, these lilies did break to many bulbs producing stems with only a few to no blooms at all. Thinking they were just crowded, I replanted them and fertilized, but results were the same. Transplanting them to a different, more amenable garden with a mulch, they regained their previous beauty.
