Bullshit, it could decode them just fine it would just take a while. It would only need a source of storage like a tape or floppy drive.
Back then and now we have our computers often do tasks which process more data than we have ram available. It's not a hard problem to solve and we even solved it back then.
You are right, QR codes are very easy to decode if you have them raw, even the C64 should do it in a few seconds, maybe a minute for one of those 22 giant ones. The hard part is image processing when decoding a camera picture - and that can be done on the C64 too if it has enough time and some external memory (or disks for virtual memory). People have even emulated a 32-bit RISC processor on the poor thing, and made it boot Linux.
I actually encoded a 256 byte DOS assembly demo (not written by me) into a self decoding plain text batch file, and then for the hell of it encoded that into a QR code.
Again, disclaimer, I didn't write the original code, but it was fun to convert into a QR code.