Sure, the amount of local territory occupied by the participating nations would be larger, but that's a strange metric for the magnitude of a war, since it doesn't necessarily correspond to the size of the actual fighting, the amount of destruction, the cost in lives. And the physical territory of the participants really wouldn't be that much larger anyway, because if we go by Star Charts, then of the Accord and Pact members that weren't involved in the Dominion War, only the Tholians have a really large territory; Ferengi, Gorn, Tzenkethi, and presumably Kinshaya space are all rather tiny compared to the others.
The Dominion War was fought on the territory of the Federation, Cardassia, and the Klingon Empire. Romulus was a late participant, its participation in the war seems to have involved force-projection outside of its borders not fighting inside the RSE's frontiers, while the Breen Confederacy was also a late participant and also apparently didn't see fighting within its frontiers. A war between the two major blocs of the Alpha and Beta Quadrants would include the RSE and the Breen Confederacy--and their territories as battlegrounds--from the start.
Would a KA-TP war be more destructive than the Dominion War? In that the worlds of civilizations which were either completely uninvolved in the conflict or involved only at a late date, sure. The Federation would do poorly, since the core sectors which suffered neither the Dominion nor the Borg are perilously close to Romulan space. More, the Dominion War ultimately could end peacefully because the Dominion could abandon its Cardassian satrapy and remain in the distant Gamma Quadrant. None of the powers in the KA or the Pact could make a like withdrawal. Escalation seems likely.
Do I think that a KA-TP war is inevitable? No. Bacco's argument to Castellan Garan that a conflict between the two blocs could kill more people than even the Borg isn't implausible on the face of it.