It's not like consoles last generation couldn't handle massive amounts of 3D characters on screen. Well, okay, the PS2 couldn't, but the GameCube was specficially designed to be able to render a large number of 3D characters on-screen and not lag. I remember they did a demo called Mario 128, where there were 128 Marios running around tossing stuff around, throwing each other around, etc., while terrain modifications were run on the surface they were on. Didn't even tax the system.
The point is, being able to do more of the same is nothing new or innovative. It doesn't have the same impact as jumping from 16 to 256+ colors, nor as big a jump as tile-based to bitmapped, nor as big as 2D to 3D. And more to the point, with so much on screen, resolution matters even less. You're not going to be stopping to look at any one object on screen unless it's the player character or your current opponent, because there's so much on screen at once that focusing on small and unimportant details will likely get you a lost life or a game over.
Sky Render - Sanity is for the weak.
