God, that's so heartbreaking. I feel so bad for the team :(
In my time with this industry, I've seen many a game get quietly cancelled, and teams let go, and it fucking sucks every single time.
Some of the team may be able to be rolled onto other internal projects, or if the studio is part of a larger corporation, transferred to a "sister" studio, but not everyone is able to be moved to something else.
This project sounds like it was genuinely promising, but mismanagement and poor decisions led to its downfall. Sometimes a lot of ego in this industry will sink a project, and it's infuriating, because, as part of leadership, it is your job to set aside ego and balance what's best for the team and your project. Bullheadedly moving forward with your "grand vision" for the project, despite being informed what is and isn't working, is beyond frustrating, and leads to others hurting because of it.
I believe I've told this anecdote before, but a long, long time ago, I was working for a publisher that had one of their studios working on a licensed game. The game was actually pretty well received by the players, because they were fans of the IP, and the game was fun. The problem, was that the game just wasn't making enough money. So one of the main leads on the projects attempted to rework the business model of the game to generate more profit, and some of the producers tried to reason with them that those changes would not be received well, and would piss off players, and ultimately hurt the game.
But the lead was adamant that their vision would work, and that the game would gain new fans (despite it being an IP that, while beloved, had a pretty limited reach in terms of gaining new generations interested in the title), so who cares if the current player base got screwed over. So their rework was implemented, and, as was warned, the community was furious, and player numbers dropped, the review scores tanked, and, ultimately, the IP owner pulled the license, and the game was scuttled. All because this person in a position of power couldn't set aside their pride and ego. And, as you'd expect, because the project was dead, and no money was being generated, people were laid off.
Making video games is a collaborative effort. There's absolutely no place for pride and ego in this industry, yet it is common. More than just your livelihood is at stake in this industry. The whole point is to work together to make this kickass game, and compromise when the unpredictability of game development rears its head. Being adaptable, and open to new ideas and input from your team mates is so fucking vital.
Sorry, this story just makes me so sad and angry, because I feel like it could have been avoided had leadership been more open to alternative solutions to the problems they were facing, whether that be reducing the scope of the game to accommodate the new engine, or reaching out to Epic to see if there was a way to work with them to get UE4 working for a game with such a potentially large player count (and, from what I've gotten from this thread, that's exactly what ended up happening with PUBG, which paved the way for Fortnite, and changes to UE4 to accommodate that scale of game).
I hope everyone on the Odyssey team is able to land on their feet and find new work.