Linear vs. Non-Linear

Just posted this on /vg/:

So, I've weighed some of the criticism on the document so far, and I'm considering a few heavy revisions and restructuring it a bit (trying to add a bit more humor). I'm also taking the initiative to try to organize the writers into a cohesive team.

But before I do, let me ask the good people what they would prefer:

A Linear Main Storyline that incorporates various villains, each harder than the last, culminating in a final big bad to save the world

OR

A non-linear game in which every villain has its own main quest and upon completing each one, you unlock the final boss battle and save the world

Each leaves plenty of room for side quests, loyalty and recruitment missions, etc.

The former would be easier to scale the difficulty of the villains, as each would be harder than the last, while the latter would probably put the villains on roughly the same level of challenge, but in different ways (Undead King has minions, Elder Sorcerer has various spells, etc)

As it stands I've been writing a linear story, and on the bus ride over I thought about this non-linear idea with the villains having their own stories and schemes that can be played in any order.

My prime concern with the second idea is outpowering the other bosses after finishing about two. Perhaps it can be dealt with by scaling the bosses and their minions, but going from, say, killing the Unstoppable Juggernaut to getting your ass kicked by bandits in the woods doesn't make much sense, you know? It'd be kind of like what happened in Oblivion with random bandits wearing Daedric Armor.

So, which would you prefer?

Here's a very scientific image detailing my two points:

Here's how I see it.
From 1 to 4 first quest bosses.
Then it expands into many options.
Just like a visual novel where you don't get to see some of the characters depending on which route you pick.
Just that you won't be dating women in this game: you'll be dating bosses,

Non linear. Also don't blow your loads too quickly. We don't need to waste all villains in one campaign. We can always add more content later, like expansions. We need to set realistic expectations here.

The diagram on the right looks like the Tree of Life.

I think non-linear would work better. It would make more sense to develop one or two storylines at a time and add them to the game as they're finished.

Completely open world from the very start, player should only be limited by enemy difficulty. After all the conditions for progression are met, the main questline opens up a brief linear sequence that leads to the final boss.
To solve the level scaling & imbalance issue, make each end villain ridiculously powerful. Powerful enough that the player will have a hard time matching them even at the highest levels. But! each of them will have his own specific weakness to exploit. For example, one of the bosses might be highly susceptible to a Reflect spell to counter his own attacks, but you won't get the spell until late in the game.