The biggest challenge a Game developer can come across is building a world that speaks for itself. Producing a generic modular stage for your story is not hard, but creating a world that is full of storytelling layers is a completely different thing.

It's important to acknowledge that at a certain point of design there is a question that needs answering: Does the Story build the world, or does the world build the story.  Or perhaps the question is so intertwined it's impossible to separate one from the other. Is this why the ruined building creates an opportunity for the protagonist to ask questions? And where do those questions lead? Does the environmental observation reveal more if you are willing to look follow the bread crumbs? 

Does a game need to have a vast open world or is a small scene, rich with lore and storytelling enough?

These are the questions that come like Tsunami waves even when doing such a simple task as designing a small map for the beginning of the game.  But it is important to remember that, combining many elements in a sensible fashion, can create potential openings for a immersive storytelling experience.

Such is the charm of the Unreal engine, that offers many free modules, and a vast ocean of knowledge for anyone who wants to learn.