Since the last update, there is a new setting in the server.properties file.
World_MaxSector=-1
# Determines how many sectors (around the starting island) should be generated/accessible. Default: -1 (unlimited)
A value of 0 would only generate the starting island;
a value of 1 would generate the starting island and one additional island in all directions (i.e., a 3 x 3 grid of islands; the starting island is in the center);
a value of 2 would thus create a world with 5 x 5 islands, and so on.