I'd say GT5 edges out God of War a bit. It has better image quality (1080p @ locked 60fps) andachieves a near photorealistic look at times.
Below are some screens to compare. Right click to see 'em in full.
And I don't see how God of War isn't up there with the best looking console games. Kratos is arguably the most detailed character model this side of Crysis. Just look at the textures on his loincloth and the detail on his chains and muscles. And the environments are quite nice too. Check out the detail on the gate.
That screenshot shows a very much updated part of the E309 demo. The game has come a long way in half a year.