Bone VDD_3V3EXP current limit

The SRM calls out a limit of 250mA on the VDD_3V3EXP line. That
supply per the schematics is driven by U8, TPS73701, which per
the data sheet is a 1A max rated part.

Is the reason for derating it to 250mA a thermal one or something
else is preventing it from being able to do 1A? (3.3V from a 5V
source would put it at 1.7W @ 1A which would seem to suggest it
is a thermal issue).

What this is leading to is - is there any reason why up to 1A
can't be pulled at a very very low duty cycle such that it
averages no more then 250mA?

If you read section 7.3.5.1 it is actually 500mA. Table 18 is meant to say 250mA per pin. The current rating on the second pin is missing from the table.

You have to keep in mind that the 1A regulator regulates the voltage that is derived from the FET inside the TPS65217 on the SYS_VOLT rail which is 2.5A. That same path must carry the current for all the regulators on the TPS65217 and the 500mA on the USB port. The 1A regualtor was chosen based on cost and availbility, not the desire to create 1A current supply to the expansion header, The 500mA number was chosen with a margin of safety in mind and as indicated in section 7.3.5.1, based on the PCB design.
.

Gerald