It's a pretty big difference. The original Ys III was a side scroller sorta like Zelda 2 in a sense, but Oath in Felghana is an enhanced remake of Ys III that pretty much redesigned the game and gave the overall story more depth.
For comparison, here's Ys III on the SNES:
Oath in Felghana:
As for how it's pronounced, even though it's pronounced like "ease", I just pronounce it "whys."