325 'colleges', 108 universities & university colleges
USA has 4,726
It could also translate, "England has many colleges", in which case it makes better contextual sense :-)
In my lexicon I found kολέγιο with one λ instead of κολλέγιο. Can we use both?
As much as I cringe at the new way the Greek language has been corrupted, yes, both are correct. The word with one λ is a newer development.
'Several' colleges could work too?
"several" is more like "a few, some" -- a relatively small number.
"England has many universities"
could that work too?
No. For example, "University of Oxford"="Πανεπιστήμιο της Οξφόρδης.