It means you talk about it and come to some kind arrangement.
In our case I met her ex and he's a nice guy, weird as it may sound he is now a family friend but we only see him once or twice a year. During the course of time my wife and I talked about a few things and our relationship became a bit more open. So basically what I'm saying is I have no problem if she bangs her ex.
But this kind of thing does not work for everybody, hence why I ask if it is an option.
Open would be more a 'when' as opposed to 'if' . I think your arrangement would classify as open is she has already banged her ex and you were okay with that. Has she?
But I get your point - I know a married couple that has an open arrangement too.