Especially since the demos seen at that show were either videos pre-rendered, or as displayed for example on Unreal 3 to show off the engine running in real time, was just being shown on a PC with a early build of the Geforce 7800...
From reports I've read, it seems the Xbox 360 could take over graphically in all areas once all the consoles get going and the developers learn the code, etc, and utilise all the CPU's, etc, simply because Sony rushed the production at the end knowing they were running out of time to produce a graphics chip so basically got Nvidia to build a PC based Geforce 7800 type card based on PC parts.
Microsoft on the other hand got ATI to build a custom chip with alot of added extras, including utilising Pixel pipelines with Vertex pipelines together, and having 10mb of onboard RAM for free antialising.
So it is less PC like this time round, and because of this, there is alot more freedom with what the developers could be able to do.
SO we'll see, I guess huh?
We haven't seen nothing yet...
I know one thing though, these consoles should be able to produce better quality visuals than PC games of today since developers work on just the one console instead of getting it to work for thousands of different PC's.
It allows them to put more work into aspects like graphics alot more easily since they'll know the abilities of the chips.