I think the Ottomans have a good position to actually regain territory in this scenario.
Legally speaking, they still have Egypt, Sudan, Cypress and Kuwait and if WW1 is anything like OTL's WW1, it will kill the British Empire. Then during the death throes of the British, the local elites in the British dominated parts of the Ottoman Empire might align with Constantinople to drive the British out. If there is a Russian Revolution, the Ottomans also could regain some ground in the Caucasus. And Turkish nationalists might be able to make good on their ambitions of bringing the Turks of central asia into the Empire. There's plenty that could stop the Ottomans gaining from either Britain or Russia, but the possibility is very much there.
As for losing territory, it is possible, but unlikely. Most of the great powers in the world benefit from the Empire continuing and WW1 will radically change the balance of power between the Ottomans and other actors. Especially with the Balkan nations, which if Bulgaria and Romania enter the war, will be badly injured.
The Ottomans meanwhile, are finally starting to see real benefits from the painful work modernizing the state over the 19th Century, will have a big windfall due to WW1 (like Spain I would expect they would make wipe out their debt and end up with a rather large gold reserve from exporting food, minerals, oil and weapons to warring Europe), industry will have been given a real shot in the arm - though there'll be a post war crash, overall the war would leave them in a better economic position if neither war nor crash had happened. Without the chaos of the Empire being dismembered and the cultural vandalism of the Kemal regime, literacy would grow faster than it did in the 20s in OTL, and I would expect that like Spain, Italy and Poland, the Ottomans would experience rapid economic growth after the post-war crash had ended.
However, the Ottomans very much can lose everything depending on how well the political center handles things. There will be two bad economic downturns and as with Spain, whatever regime in running the country could be unable to cope something messy could happen. I'd not bet on a civil war as in Spain however, and more like a badly chosen war to reconquer some part of the former empire leading to bad things.
Thinking about it... An Ottoman Empire without WW1 could look an awful lot like Fascist Italy by the 1930s...
fasquardon