I think a lot of people expected more from the graphics than is feasible on the PS3. The PS3 is a lot more powerful than the PS2, but it's important to understand the huge jump in resolution and the impact that has.
Forza 3, which seems like a pretty good engine to me, supports 8 cars in 720p at pretty steady 60fps with 2xMSAA. GT5 is pushing 16 cars at a higher resolution and with 4xMSAA at 720p and 2x at 1080p (so far as I know).
That's twice the cars, and cars that are more detailed as well (premium that is) so in many cases you're talking about over twice the detail to be rendered in cars alone. Throw in equal AA at a higher resolution or twice the AA at 720p and it's obvious the AA effort is higher, too.
Even allowing for the fact GT sticks with non 3D trees vs Forza the engine is trying to handle a lot more than Forza pretty much all of the time. The trade of is a less stable - although for the most part still very impressive - frame rate and some tearing (not too much vs many other titles either) as well as a less even look to the graphics overall - some lower resolution textures here and there on the tracks, some AA issues in some weather conditions, etc.
In short, GT5 so far as I can see is an amazing coding effort. It's pushing the hardware incredibly hard, arguably a bit over the edge if your goal is for a very consistent graphical experience.
I have no doubt PD could easily have delivered 16 cars in 720p at 2xMSAA with a rock solid 60fps, but they were clearly aiming higher and got there as best they could given the PS3 hardware - and it took them a while, too!
The main focus of GT engines has been the car handling and the graphics. Pushing the AI further would require a change of balance, for example, as it would require taking some power away from the handling and the graphics, for example.
I think GT5 is exactly what you would have expected - traditional GT engine and approach and priorities pushing the resolution and graphics as far as they could. The one big change so far is damage but I haven't had time to experience that yet (damn leveling systems!). And online, too, I guess
(note for those who are always way too sensitive - I'm not knocking Forza, simply noting that with that game as a benchmark for a good engine it's possible to easily see how much further PD were trying to push their engine technically. As noted Forza does lock the graphics to a level where performance can be consistent, which is no bad thing, PD with GT5 chose to move out of that safe spot to where fluctuations can occur which some for sure are going to consider a bad choice)
Personally, while I understand the choices PD made with the PS3 hardware I would actually have preferred they cut back just a bit on the graphics to ensure a fully smooth 60fps without screen tearing, as well as allowing them to ensure a much more even look to the game.
I don't think they'd have needed to drop too far to achieve that but I guess we'll never know.
As it is GT5 so far as I see it is one of the premier coding feats on any console this generation (next to GoW and Uncharted 2). It doesn't always look as evenly balanced as it's predecessors, but there is no doubt it is indeed way beyond them at the same time.
Try to be reasonable... its easier than you think...
