That's not what hinode is saying. What hinode is saying, I think, is that you cover the entire world, so you see pretty much everything, but nothing in depth. He said it has scope; you're doing things on a large scale, saving the entire world, etc.
Now, when you centralize a plot and put it to a small area? You naturally take a different angle at things. Look at FFT for example. The entire game is centralized in one country, Ivalice. Due to this, you add a whole political aspect to the entire game, you see all the same faces, etc. You aren't really going anywhere, nor are the villains on the move. Yeah, they go from one city to another, but everyone is relatively close to each other.
Suikodens usually take a similar style for their development since they cover regions, not the entire world (S1 was Scarlet Moon/Toran (whatever you wanna call it), S2 was Highlands vs. City State specifically, etc.) As such, its not about "saving the world" but "beat the opposing force" and all that. Its a different angle the game takes.
It has nothing to do with quality, has to do with what kind of direction it takes.
FE7, though? It covers about the same microcosm area as a Suikoden or FFT...but its plot does nothing with it. It just has the generic "Rar, I'm evil, THE WORLD SHALL BE MINE!" villain, but instead of travelling the world to defeat him, you're travelling...2 countries?
Lyn mode didn't try to pretend anything, on the otherhand; they made it clear it was "Save Caelin from tyrant!" It wasn't the world, it was Caelin specifically. If nothing else, Lyn mode had something that Eliwood/Hector mode did not; it had direction. Lyn mode you knew your goal from relatively early on; stop Lundgren who apparently is Lyn's (Great?) Uncle and the guy whose causing trouble, and acquaint her with her grandfather she never met. Its not much, but its there, and its easy to remember.
Eliwood/Hector mode is...pretty much a wild goose chase, and half the time its "Ok, so...wait, what am I doing now? Why am I in a desert again?"
FE6 at least had it clear you were basically facing Zephiel and trying to get the Legendary Weapons before he did. FE8 had it clear that you were trying to save the Sacred Stones (and get your hands on the Sacred Twins), as a common goal throughout the game. Once you got them all, you went after the bad guy himself. Again, its not much, but at least having some clear defined goal helps keep plot direction. FE7 was "there's an evil guy, KILL HIM! KIIIIILLL HIM!!!! NO, DON'T ASK WHY, HE'S JUST EVIL!"
That said, yeah, a Zephiel game could have been neat. It'd give this strange sense playing the game that you know the hero of the game is just going to end up being the bad guy in the grand scheme of things, but then, that'd be what'd make it a unique experience (much like in Crisis Core, you know that as great these feats Zack is pulling off, as awesome as he is...he's still going to die right before getting to Midgar and there's nothing you can do about it.)