Put the plugs in an open hole flute and play it, then take the plugs out. Noticeable difference in tone and projection. I demonstrate this for students all the time to get them excited about upgrades. Does it mean you can't sound good on a closed hole flute? Of course not. Does that mean an open hole flute won't help a student sound better more easily (assuming they can handle the open holes)? Of course not.
While we're talking about it, B foot also changes the tone and increases projection versus C foot. Can test by finding compatible flutes and putting switching the foot joints out. Also a demonstration I like to do for students.
I'll admit I didn't believe there was a difference until I tried all the combinations for myself.
That being said, C foot is fine for beginners, but if you're investing in school instruments, might as well invest in the open hole model to start with and plug the holes. Then you have the option later of opening up the holes.
Although I think also the person above who commented on more attention to detail in open hole flutes being on to something... Closed hole in this day and age in the US is viewed strictly as a beginner flute, and I'm sure the manufacturers put the corresponding amount of effort into them.