Never played it. I'll check out some footage and get back to you.
Update: hmmm skimmed through Let's Plays of the first 2 hours or so. Doesn't look like you're ever traversing any geography to get from static POI A to POI B. Doesn't look like you can go back to where you've been in the past. Looks like a bunch of levels connected together from what I can tell.
Part of an open world game is that you can go back to where you've already been, or often to places where the narrative hasn't explicitly directed you yet. And it's not all or nothing. Is Fallout 4 not an open world because the game gates your access to The Institute before certain conditions are met? Similarly, does having to breed a chocobo to pass the swamp snake exclude FF7 from being an open world game?
Once I got the appropriate travel means, I was absolutely free to go to towns that the narrative hadn't yet sent me to. Sure, there may not be much directed triggered content for me to complete there, but I could go. The game didn't FORCE me to go from Level 1 to Level 2. I could go grind cactuars instead of progressing the story just fine. I'd even consider games like The Legend of Zelda an open world game.
Check out
this very well made videoon the subject. Mentions Final Fantasy series @ 9:54
Final Fantasy games (well, I should say prior to I guess, 10) always had the "open world", but we're really only using that term based on how much they took away starting with 10 and into 13 part 1 (12 is a whole different type of game). Your choices for where you could go would vary, depending on the part of the game, but there were usually some "mode of travel" block, or plot block, that would only allow you to explore so much. Whether it was the Tiny Bronco in 7, or the hovercraft in 4 (seriously, 4 had literally the most amount of travel shit it felt like: fucking hovercraft, original airship, red wing airship, red wing airship with drill installed to get out of the Underworld, original airship with fucking hook to pick up hovercraft to access random story plot advance point, fucking Big Whale airship to go to the moon), or even just Nibelhelm blocking the only pass to open up more of the world map...there was always a hard cap on how much you could access until you were in total side quest/endgame mode.
Now, 7 did have quite a bit of back tracking and exploring you could do, with optional characters/content, and certain events you could do if you back tracked after certain story points. I'd say 7 and 6 did this the best. Certain parts of 4 let you explore a good bit of "new" area, but it was mainly only after you just got the original airship and were able to check out some island areas that weren't accessible before. 7 seemed to reuse old key areas as main story points that you would travel back to quite a bit, either to advance the main story even more, or for mini games.
If they actually are going to flesh out some more of the side areas in addition to Midgard, it would be pretty cool. I'd expect them to show off a lot more flashback scenes, and not just the ones from the original game. You could do a lot more story and content in places like Wutai or City of the Ancients with flashbacks showing the war in Wutai and fallout, actual shit from the past in the City of the Ancients. Shit the original game had a lot of backstory if you looked for it on the Ancients, but the details only went so far. More areas of theirs to explore or more backstory when you're with Aeris and have her as a part of your group would make sense for them to do.
I do wonder about them saving progression too between "episodes". If they come up with a different way of advancement than levels, I could see it being not too bad, but if it's just straight levels, both character ones and materia levels, going to be a bitch for those grinders who like to out level the shit out of everything, only to possibly have a reset back to whatever new starting point they set you at for the next episode.
I'll still buy the shit out of it, but there better be a lot more meat to the old game or a continuation of the old story's end point if we're talking 3+ episodes.