Would it be possible to set up a system to turn off an animal's wandering AI based on if there is a certain amount around eachother or in a chunk? so that animal farms (especially large ones) would see major performance improvements?

Its possible but would need to check the best way to implement it. I think in newer versions of minecraft we can turn off the AI brain entirely. Just might be tricky to turn it back on without scanning each chunk.

You'd probably want to stick with the wandering AI so that things like sheep can still grow wool and breed.