I thought there was another source which indicated they were using 3 degrees of separation.
It is therefore entirely plausible that "everyone in the country" is within 3 or 4 degrees and that such was a very veiled admission to spying on everyone domestically.
It came from congressional testimony by one of the government witnesses - don't remember which one.
He also clarified that FISA approves the processes and procedures used. There are 28 people in the NSA who authorize the actual searches - FISA doesn't see or review them.
Periodically, FISA requires a spot check of queries to make sure they conform. They don't "audit" or investigate that all queries are appropriate (which wouldn't be too hard if the query audit logs are maintained properly).
Also, annually, the NSA produces a classified report for the congressional national security committee that is.... [drum roll]... 1/2 of 1 page long! WOW - transparency at it's finest.
And the useful idiots on Capital Hill are perfectly happy with all of this.