What I understand is the more outstanding shares there are, the more investors positions are diluted.
That's not entirely accurate. Dilution happens when new shares are issued, reducing the ownership percentage of existing shareholders. If I own 10% of the outstanding shares (regardless of how many shares that is), and the company issues more shares, my percentage goes down. It doesn't matter if I own 1 of 10 shares and the company issues 10 more or I own 1 million of 10 million and the company issues 10 million more. The effect is the same.
For a company that has a lot of shares, say 2.5B, how does this impact the share price?
Not much, really. The price per share is just the value of the the company (which can be measured in multiple ways) divided by the number of shares. So while the price per share technically is lower if more shares are issued, you can buy more shares with the money needed to own a certain percentage of the company.
Say you have a cake that's worth $100. Does it matter if you split it into 10 pieces worth $10 each or 50 pieces worth $2 each? No! You pay the same for a given amount of cake either way.
In fact, a larger number of shares may actually be good for share price, since investors don't have to invest as much to buy the minimum amount (much of that is not applicable anymore with brokers that offer fractional shares, though).
Does it mean that in order for the share price to move up and down, more volume is required because the number of shares is so large?
No - "share price" is commonly measured by the last transaction regardless of size. So someone could trade 1 share and that could change the share price. It does not necessarily mean that you can trade an unlimited number of shares at that price, but that's another topic.
Share price is basically the present value of future earnings per share as perceived by investors, therefore, the more shares outstanding would mean the more volume necessary to move the price, or so it makes sense to me.
Not sure what you mean by "volume" here, but when everything is in terms of "per share" the number of shares is largely irrelevant. Investors look at _relative change (e.g. a 5% increase), so the actual change is not that important. If companies want a higher share price, they could do a reverse split (reducing the # of shares) and increase the share price by many times over, but it has virtually no bearing on the total value of those shares (like the pie - do you care if you have 1 piece worth $10 or 10 pieces worth $1?)
Thus, are dilution and volume the major drawbacks of companies with high shares outstanding?
No - neither of those are drawbacks to having a large # of shares outstanding.