That depends on what franchise we are talking about. Realistic visuals matter more to some than to others.

Personally, I really don't care as long as PS4/XB3 are as good as or close to the best looking PC games currently available. Going beyond that is a bonus. Realistic visuals can only go so far until you don't care or notice anymore, while the gameplay is where they have unlimited options to expand and revolutionize the way we play.

Of course the Raw power is very important. Power is not just important for Graphics and performance but it enables games to be better. With a more powerful console we will be able to see better AI, larger maps, better physics, more content and have the ability to have more things happening at once, for example: Having 300 zombies chasing you at once instead of 30 or when charging in with an army (like in fallout new vegas) instead of having 10 soldiers with you you could have 100 soldiers.

If you don't see much difference in the graphics of PS360 titles and PC, you're either playing the wrong games or you need to look again.

And; yes, power will be important, people assume that HD is the end of the line when its only the beginning. Now is when the true fun begins when it comes to visuals, physics and AI and it all requires truly powerful hardware.

I would prefer the leap of technology is used on improving the world rather then graphics of a character. Like if the next elder scrolls was 5 times as big as skyrim. It is very possible but I do not think it will happen.

of course not
there are games on the GC and the N64 that are better than some PS360 games
ideas make games

No.

As I mentioned in a thread a few months back, next-gen will be as much about the games as it will be about "smart" features/apps/media/etc. These devices will be considered overall media hubs and not just game consoles.

Also, the reason nearly all your PC games look like the same PS360 games is because they are PS360 games. Only games built on PCs and down ported to PS360 look different (see Battlefield 3). However, that is not the norm anymore as they generally are built on consoles and then ported to PC.

Graphic  chips of that calibre are way out of the possibilities for a console. Those are 150W chips, impossible to cool in a console and way too expensive. If starting design now, a cut-back GT660/ATI7870 would be the max to hope for. But design was done 2-3 years ago so don't expect much more than a somewhat better WiiU chip (which is good enough for the targeted 1080p at 60Hz). The key is a simple hardware design and a lot of ram to please the developers.

Raw power only goes so far in terms of processing. The architecture of the system is almost just as important. This is why some developers say certain platforms are easy to develop on and others aren't.

Only if it improves the gameplay.

Only if it improves the gameplay.