Oh great. Better graphics on the same engine will mean longer loading times, smaller areas, forcing you to run the same areas over and over, regurgitating textures, and just general chew up more budgeting and human resources at the expense of all the other and arguably more important game facets.
The games industry is in need of a revolution. Let's stop talking about graphics and start talking about art. There need to be more games that accept that they are not reality, they are only imitations and/or depictions of reality - or even fantasy in this case: and thus embrace the creative potential of their medium, using non-realistic art styles to achieve more of a sense of immersion. Something like what happened in the late 19th century with the advent of photography; instead of trying harder to make their paintings more realistic, French artists instead made them less realistic and more subjective - and thus impressionism was born. This is what the games industry needs. There should be more games like Borderlands and World of Warcraft which have an intentionally non-realistic and stylised art design.
There I go again, being all idealistic.