What is an Old World exactly?

An old world is a finite world type that measures 256 x 256 blocks horizontally, and a maximum height of 128 blocks. This world type generates biomes smaller than normal to fit more biomes in small area. The y coordinate ranges from 0 to 128.

Does it generate the new features added in 1.17?

Yes, all the new features added in 1.17 like copper ore, tuff, deepslate, deepslate varients of all ores, and even Amethyst Geodes do generate in these Worlds.

What about the new ore distribution?

When I tested the ore distribution, I found that all ores including diamonds generate in abundance. It seems like these worlds still generate the ores based on pre 1.18 (before 1.18) ore distribution so you don't need to worry by not being able to find diamonds.

How do Caves and Cliffs generate?

Caves do not generate in this world type probably so that ores generate more in number. It seems that cliffs generate similar to pre 1.18 (before 1.18) but smaller [Further Testing required]. When trying to generate higher than the height limit they are cut off.

Are Nether and End limited too?

You cannot access Nether and End in these worlds. However you can place their respective portal blocks using commands to enter either dimension. Making Nether Portal far away from your entrance portal and entering it may result in your character becoming stuck since 1 blocks in Nether = 8 block in Overworld. Nether and End are also limited (256 × 256) like the Overworld.

Do all structures generate in Old Worlds?

No, some structures never generate in Old Worlds. They are Mineshafts, ocean monuments, woodland mansions, strongholds, dungeons, desert pyramids, jungle pyramids, swamp huts, igloos, ocean ruins, shipwrecks, and pillager outposts do not generate, making resources limited. Villages do generate occasionally.

Here are some pictures you make like 

Note: Enable the Resource Pack in Global Resources for it to work.