It seems that might be a pretty tight joint to perform an arthroscopic aided fusion. If arterial supply is robust - I feel a standard open technique should not be so much harder on the patient. My thought is that as the post-op course of non-weightbearing would be identical whether open or arthroscopic - the incisional size would not be the true limiting factor in the elderly.
I agree it is a tight joint with a large anterior osteophyte. If they have skin that is not amenable to a open technique or any degree of PVD you could do it arthroscopically but have to get that anterior ankle debrided well so you can access the rest of the joint. If doing open a small anterior incision with a percutaneous 3 screw technique does well in the older patient