A recent Final Fantasy XIV interview gives us some behind the curtains insight into level design featuring Lead Level Designer Arata Takahashi.
The interview touches on various topics relating to level design, including some background on Takahashi and what exactly level design is. Takahashi also elaborated on dungeons saying,
“When it comes to dungeons, it goes without saying that we work on the scenery, but we also have a hand in designing everything that occurs as you progress through the instance…I felt that the dungeon should present a real-time portrayal of the miserable situation brought about by sin eaters. From there, I pieced together a story structure and its components.”
Takahashi also touched on one of the most memorable moments of the job,
“One notable example is Air Force One. FFXIV didn't have any pre-existing systems that worked in the same way, so the Level Design member in charge painstakingly put together a new system from scratch.”
The full interview is pretty extensive and provides some pretty good insight into the development of such spaces. You can check it out here.