@Bod:
I think the issue stems from the different perspectives here. You are looking for an extremely functional representation, infact better visuals can be a negative for you because you derive your enjoyment from your competitive games in besting your opponent, and improving the visual accuity can clutter the screen up.
On the other end of the scale are the people who want to be immersed in the environment. Become the Spartan in Halo rather than play as him. For these people better graphics can provide better immersion which provides a better experience.
Most people fit into the middle somewhere, so both graphics and gameplay are important. Personally I rate them both equally and I like my games to have good measures of both.
The difference between movies and games is that one can take a camera, stick it on a tri-pod and achieve functionally good visuals which could appease almost everyone in their potential audience. A game developer cannot do that outside of certain genres such as 2d platformers, so there is an emphasis there on improving quality. There is always room for improvement, whereas with cameras the visuals have remained static for years.
Lastly, if FPS games are considered to have remained relatively static over the years and the only major improvements in the last 10 years have been visual. Then if the games market has grown since then with only those visual improvements you have to concede they may be of importance to enough people to make an impact on the market. (Not as much recently as the Wiimote was but still important)
Tease.
