Yes, the seams are separating. I would really like to repair and use this flask for sentimental reasons. Maybe I will just stitch a new seam on the outside like Tom a Hawk did, or should I go with a whip stitch?
Since I didn't know my Maternal Grandfather, as he died when I was only about 9 months old from the Poison Gas the Huns used in WWI, I only knew my Paternal Grandfather. Since he and Grandma had to wait until they were older to have children, my first memories of him was when he was in his mid/late 60's. Even so, I formed a powerful bond with him before he passed, as I both resembled him very much physically and he had a lot to do with shaping my work ethic and personality. Many years later my Dad would watch me working and a tear would form in his eyes and he often told others it was just like watching his Dad work. When Grandpa passed, I wanted and got hand tools his Father and he had used in their lifetimes and the family sword. I only mention this to show how much I can understand and sympathize with you.
Without being able to examine it in hand, here are the things I suggest you consider:
1. The most important thing would be to preserve the leather and total shot pouch, in honor of your Grandfather, whether you could actually use it or not.
2. Is the condition of the leather good enough it can actually be repaired without further damaging it or harming it further? If it sat too many years without being regularly oiled as needed, it may and probably did dry rot the leather and that means the seams will most likely be affected/weakened the most. That may mean it may or may not be repaired, but only preserved.
3. Is the condition of the leather good enough that after being repaired, that you could actually use it after repair? IOW, it may be in good enough condition to repair, but not in good enough condition to use it - as shot puts a lot of stress on the sewed seams.
First it is very, very important with no pictures, to ask you whether the pouch stitching is seen from the outside like the one Tom A Hawk showed above? This kind of stitching is the easiest to repair and preserve, whether or not the leather is in good enough condition to use after the repair. So let's begin with your answer to that question.
Gus