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game engine-wise no doubt, but when you can't show it in every race, it's not of much use. (talking about damage mainly. Though that doesn't mean that I wasn't disappointed when I saw the "damage" in Forza 3 for the first time.)

Higher resolution is pretty much a non-factor in this case, since GT5 runs a bit slower on average. Should be around the same if both are 720p or both 1280x1080.

Only real factor are the 8 additionally AI drivers.

Though in the end it's hard to say how much farther Forza could go. Definitely hasn't reached its limit at the current settings.