Bandai Namco confirmed that the Water 7 Arc of One Piece will appear as a memory the Straw Hat Pirates will re-live in One Piece Odyssey. As of the time of writing, there is no trailer or specific information on how the arc will play out. However, since there was a trailer showing off gameplay and cutscenes for Alabasta, there may be a Water 7 trailer soon. [Thanks, ryokutya2089!]
In One Piece Odyssey, the Straw Hat Pirates will have to go through past events. However, because they are stronger and already know what will happen, the game’s version will be new for existing fans of the show and manga. For example, even though Robin was not part of the crew during the actual Alabasta arc, she is their ally in the game’s version of it.
Water 7 was the fifteenth story arc of the series. This is when Franky joined the crew as the shipwright. Due to reasons revolving around Robin, Water 7 flows directly into the Enies Lobby arc. It is unclear at this point whether or not the game will cover events from Enies Lobby, or if it will be specifically focused around Water 7.
One Piece Odyssey is in development and will come out on January 13, 2023 for the PS4, PS5, Xbox Series X, and Windows PC. If you purchase the limited edition, you can get a figure of Luffy and Lim.