NOTE: Un-cancel my cancelled working, it's relevant to my answer.

Basically a table has limited space, so the minimum table space per diner just means that each diner takes at least that much guaranteed space. So the more space taken per diner, the less number of diners there can be on one table.

From there we consider how many diners we can fit into the venue after the space occupied by all the tables has been accounted for, subject to the limit of the number of diners per table.

In real life, however, I doubt each table will be fully occupied anyway (I have not seen a food court in which EVERY single seat is occupied even though every table may be occupied).