Well, nothing is set in stone. Everything is flexible, and even more so so modding and the like. I’m not making the game for myself, I’m making it for the players! So the players have will have the final decision with what goes or what stays.
My main idea with a larger area (or world) is that that every world will have ALL of the resources you need. The biggest complaint right now is sometimes a world can just be sandstone, or not have any, sometimes no snow, sometimes too much, sometimes no swamps or caves, sometimes too much, etc. Having a larger area will help me to make sure there is guaranteed “zones” or “biomes” available in each playthrough. That doesn’t mean you will have everything in walking distance, it just means you aren’t completely screwed if you need something that isn’t even in your world. The terminology and semantics are probably failing me here, but I don’t intend to make a giant landmass, I intend to make a larger world, with certain biomes dedicated to certain types of terrain. Smaller islands and areas will always be present, they are a defining feature of the survival.