One of the problems with what they've been doing with films that cross over into the existing movies or have backstory for those characters is that they have to tip toe around current cannon. Retconning some stuff, stretch explanations for other stuff, etc. If they would do a completely new story they wouldn't have to worry about inconsistencies or having people nitpick the circumstances.

They could either set a film thousands of years before the original trilogy, or they could make a true side story during the same time period that has nothing to do with the Empire/Rebellion dynamic.

I do think they are planning on doing something in the Old Republic era at some point. Since the new cannon has been established, they haven't even touched that era - not with film, books, even video games. If they weren't planning on doing something there then it would be no big deal to have someone write a cannon Old Republic novel or develop a new cannon video game or something. But they seem to be saving that era for something specific - maybe a movie or a TV show.

If they wanted to do a side story movie in the same era, then as I mentioned above it needs to not be about the Empire/Rebellion galactic civil war plot. They have plenty of options - a criminal underworld film could fit that criteria. They could do a political thriller film set on a planet that is neutral. They could do something like that on Mandalore, or some new planet we've never heard of.

They could also do a film about an unknown Jedi who is in isolation after the Jedi purge. Maybe an "ex-Jedi" who completely stopped using the force because he lost his faith and also to keep from being detected. But stuff ends up happening, and he has to take up arms. Maybe he even decides to seek out the Rebel Alliance but gets killed off at the end of the film before he can make his presence known.

I don't know, but there are TONS of options, and I really don't want to see a film about what Boba Fett eats for breakfast.