The dragons have been ravaging Coerthas even in 1.0 - Ishgard is stated as being in an eternal war against them. That doesn't mean that the entire zone has to be a battlefield all the time. And if you've completed the main storyline, you'll know that
following Operation Archon the Empire's advance into Eorzea has been effectively halted, if not eliminated completely - Gaius's death basically took the wind out of the XIVth Legion's sails - they were stated early on as being alone in Eorzea without any chance of support from Garlemald itself due to the infighting in the Imperial Court, so with Gaius gone, their march of conquest has essentially ended, at least for the foreseeable future. Sure, there's still Imperial troops around, but they're nothing more than remnant forces who are just an inconvenience instead of being a legitimate threat.
It sounds to me you just want something like Campaign or Assault from FFXI in XIV - the irony is Campaign is essentially the prototype for the FATE system anyway. It could stand to use some tweaks though I admit, but really, FATEs are already open world large scale conflicts anyway - putting a new Campaign style system into the game would just be superfluous.