I agree with the OP. To many companies are focusing on the best graphics. But how much of this comes at the cost of AI, Physics etc etc.
Some people have already given examples of good AI this gen. Again I'll reiterate Halo 3. It's probably one of the few games this gen that has put EVERYTHING else before graphics. They had down what they wanted from the game and made the engine to run with everything not compromised.
Eg. Halo 3 = Amazing AI ( flanking, grenade flush outs, grunts actually flee if you kick the arse out of the Brute/Elite leaders. They try and steel your vehicles. the list goes on. ) Add to that 4 player campaign, 4 player same console online multiplayer. Theatre mode ( Of which you can pause a playback go ahead in the level to where you actually are not to yet and watch some Brutes and Grunts mess around etc ) Not to mention you can have 12 buddies with you, whilst fighting 15 - 20 foot soldiers, 2 tanks, 2 ghosts, 3 banshees all at the same time. There is so much to Halo 3's engine that is there for a reason.
With the extra 2 years that Halo 3 ODST has had, hopefully they will upgrade the engine to be more efficient and give us MSAA, 720p whilst keeping the 2 framebuffers which give it the best lighting of the gen.
People judge a game engine on graphics to much, but Halo 3 is the most complete package FPS for a console yet. And thats becasue Bungie didnt compromise the balance/gameplay/features.







