Closed off balconies have solid areas for rails instead of slats. So if you are sitting down you can see the sky (which does give you a nice view of Spaceship Earth, but doesn't allow you to people watch on the BW). If you look at a picture of the front of the resort, you will see that some of the balconies don't have railings, but short walls.
The Illuminations view is not very good (IMO) from any of the BW. The BWI is in the way, so you only get the high fireworks - and not many of them go off high. Illuminiations fireworks happen in three batches, so you watch a few go off, sit for some minutes, watch a few more go off, sit a while longer, and then watch the finale. Almost everyone in our party got bored between batch one and two or two and three and gave up. If you are staying at the BW to watch Illuminations, go into Epcot or watch it from the bridge to the Dolphin or the boat dock at the Beach Club. I'm guessing the farther towards Atlantic Dance you are, the better the fireworks view will be.
It is a very nice view, just not as nice as some of the hype - don't set your expectations too high - and its certainly not worth pitching a fit at the front desk because you didn't get it.