Yes. What they are doing is okay, even if it does make the game more boring.
Technically, what @L. Scott Johnson put in his answer is correct, but mathematically speaking, there are only so many tiles in total. Rummikub has 106 tiles in total, consisting of the numbers 1-13 in 4 different colors. This is 52 tiles in total, and there are two of each tile, which is 52*2=104. Add 2 Jokers to this and you have 106. Once we have the total number of tiles, then we have to figure out what the maximum amount of tiles that 1 player can get in their hand. Each player starts with 14 tiles, so we can immediately subtract 14 tiles from the 106.
106-14=92. If Player 1 plays first, then he draws a tile, giving him 15. If Player 2 plays a set of 3 tiles, then he would have 11 on his rack. After this, for the next 10 turns, player 1 would draw 1 tile from the bag each time, while player 2 would add 1 tile from his rack into a set, or a split, or some other way onto the board. After these moves, there would be 13 tiles on the board, 25 tiles in P1's hand, and 1 tile in P2's hand. This gives a total of 67 tiles left in the bag.
Next, in order to prolong the game (so that we can reach the maximum amount of tiles in P1's hand) P1 and P2 would both draw a tile. This makes the P1 hand, P2 hand, board, and bag totals 26, 2, 13, and 65 respectively. Player 1 would then draw yet another tile, and Player 2 would play 1 tile upon the board. The new totals would be P1 hand: 27, P2 hand: 1, board: 14, and bag: 64.
These two moves (draw and draw) and (draw and play) would have to be repeated until the bag runs out to find the maximum amount of tiles in a single player's hand. 3 of the 4 moves are draws, so 64/3 = 21.33, or 21 of these double rounds (42 more in total) and 1/3, which constitutes just the first move of the first of the two rounds (draw, ---).
So the maximum amount of tiles any one player can obtain in their hand is 71.