Does this recipe for mushroom meatloaf really only need 1/2 lb of ground beef

It is correct - the mushrooms take up the majority of the loaf, and the beef is more like a filler, hence why there's not so much - but that doesn't mean you can do a full lb. because I know that's the standard size the meat comes in :)

It looks like a mistake to me. I spent some time (after doing a 52 Search for 'Beef Meatloaf' under Recipes)looking at 2 diff recipes. I think this is the better of the 2:
https://food52.com/recipes/24302-fatted-calf-s-meatloaf
The upshot is that the 2 recipes use 1.5- 2.5 lb meat to feed 6-8 people; and both recipes only call for 1 egg (yours only has 1/2 lb. meat and calls for 2 eggs); and their bread crumb amounts are similar. I figure 1 adult eats 4-6 ou. meat as an entree. If it's the mushrooms that appeal to you in this recipe, you might look through some of the other 52 Meatloaf recipes that have many raves in their comments- and add mushrooms to one of those. I went through a major Meatloaf phase last year and the one tip i can pass along was what a difference cream made to the texture of any meatloaf. best of luck.

I can't be certain Patricia as I haven't made it, but from looking at the fact that it is to serve 3-4 people I think this would be correct. You would effectively have equal quantities of mushroom and beef, so the egg should be sufficient to bind it together, whilst the breadcrumbs will stop it being too liquid. Hope this helps - please post a photo and/or comment if you make it, I'd be curious to see the results!