As a hobbyist producer myself, I also want to point out that how the music is made is not defined by MIDI versus live orchestra. Most professional music today is composed from separate tracks that are digitally processed and mixed down to a master track, meaning each instrument (or element) is recorded separately, so that it can be processed and adjusted manually. Sometimes, this is also combined with the use of sequenced elements, like synthesizers, to create a hybrid style of electronic music that incorporates, for instance, elements of a live orchestral recording (e.g. a string section, a bassoon, or a violin), fused with sequenced percussion samples and synthesizer riffs. If each element of the composition is processed and mixed professionally, it will in turn sound professional and clean. Alternatively, the live orchestra elements could be replaced with an acoustic guitar, a piano, an ukulele, or all of them. Then it would be up to the composer whether to record each element from a live ensemble, including the acoustics of the environment where the recording takes place, or to record each element separately, perhaps even using an isolation booth where possible. In the latter case, the producer will have complete freedom to shape the acoustics of each element, to create the sense of ambience that is most desired for the song. Most modern music is recorded and produced this way.
Back in the days of the Nintendo 64, the limitations of the system required the music to be sampled and sequenced, as opposed to streaming audio directly from a recording. Because of the limited memory capacity of the N64 cartridges, it was necessary to keep the size of the audio samples down, which in turn means reduced audio quality. In addition, composing in a MIDI format would also impose its own restrictions, primarily in terms of dynamics, having to compose melodies from static one-shot samples. However, now that most video game systems are capable of processing streaming audio, also having more than enough memory to feature big audio soundtracks, there are basically no restrictions regarding the audio quality of a video game soundtrack, other than the supported formats for streaming audio. So basically, what the soundtrack for Yooka-Laylee will sound like is all in the hands of the composers, and how they choose to produce the music. I think the pieces by Grant and David on the Kickstarter are pretty good styles for the game's expression.