We are able to get GREAT graphics now, with camera tricks, and masking stuff. What was in the 2005 E3 trailer for Killzone was MONSTER draw distance with a LOT of detail. We just aren't there yet. Also, the amount of detail in the explosions was impressive also.
However, if you want to ask a REAL interesting question, when do people think we will hit what was seen in the 2005 E3 Motorstorm trailer?
I would say we are probably looking at the end of next generation, or the following generation AT THE EARLIEST.