There is a problem with something (unrelated to WC) in the final product i see there is avascript which is stopping the rest from outputting < - this looks theme related to me.
<li class="product first">
<a href="http://www.u-tees.me/shop/tee-shirts-for-men/i-heart-me/">
<img width="300" height="300" src="http://www.u-tees.me/wp-content/uploads/2012/11/i-love-me-b-300x300.jpg" class="attachment-shop_catalog wp-post-image" alt="i-love-me-b">
<h3>I Heart Me</h3>
<span class="price"><span class="amount">$18.99</span></span>
</a>
<script src="http://stats.wordpress.com/e-201252.js" type="text/javascript"></script>
<script type="text/javascript">
st_go({v:'ext',j:'1:2.0.4',blog:'42070187',post:'0',tz:'0'});
var load_cmc = function(){linktracker_init(42070187,0,2);};
if ( typeof addLoadEvent != 'undefined' ) addLoadEvent(load_cmc);
else load_cmc();
</script><img id="wpstats" src="http://stats.wordpress.com/g.gif?host=www.u-tees.me&rand=0.7636764745693654&v=ext&j=1%3A2.0.4&blog=42070187&post=0&tz=0&ref=http%3A//wordpress.org/support/topic/number-of-products-on-page-cant-change%3Freplies%3D15" alt=""></li>
Change your theme to a default theme.. NON-Customized and see what happens.