Export to Excel is a great feature in Dynamics CRM toolbox, but it has always come with two limitations
1) Number of records that can be exported
2)Format of the Excel file
3) The exported file to Excel is not an xlsx format. Hence this limitation has been addressed in CRM2015 Update 1. The number of records you can export has also been increased to 100,000.
But if you still want to export the whole dataset, the easiest way is to export it from the filter view in the MSCRM database. It is obviously not possible if you are using CRM toolbox Online.