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The whole game is just CGI man. Even the 360 version who runs at sub HD looks better than most games during cut scenes. There are 2 types of cut scenes in the game and they are both CGI, just that one is rendered in the game engine. This is not real graphics though as you can not control the characters in any way. Its a pretty game though, but not as pretty has Heavy Rain imo, another game that uses "cheat" graphics. Gow 3 on the other hand... thats what i call graphics.

I am assuming this is console only graphic discussion, since pretty much any new game on PC has better graphics than all these games i just mentioned.