It's always irked me. It's like saying a Photoshop binary is "open source" just because you can (theoretically) run it on your own computer instead of through a SaaS web app.
Also since you brought it up, I'd argue the difference between SaaS and local is way more important than "open source" vs "closed source". Closed source you can decompile. SaaS on someone else's cloud, you can do fuck all about.
That's why SaaS is so popular, too.