I honestly don't know if they are increasing world capacity, but I wouldn't be surprised if they didn't, nor would I be surprised if 1017 remains a nuisance after the update. Square Enix has proved that they are incompetent when it comes to this kind of thing. Single-player RPGs seem to be their forte. "we believe that many of the login issues that players are currently experiencing will clear." - translation: it might still happen afterwards.