Open Client is the interface (API) between client systems and Sybase servers. Fundamentally, it comes in two forms:

Runtime

The runtime version is a set of dynamic libraries (dlls on W32 platforms) that allow client applications to connect to Sybase and Microsoft servers, or, in fact, any server that implements the Tabular Data Streams (TDS) protocol. You need some form of Open Client in order to be able to connect to ASE in any way, shape or form. Even if you are running isql on exactly the same machine as ASE itself, communication will still be via Open Client. That is not to say that client to server communication on the same machine will go via the physical network, that decision is left entirely to the protocol implementation on the machine in question.