I always think best looking graphics all depends on which side of the fence you sit on. PS3 crowd will say Killzone/Uncharted/GOWIII.
360 crowd will say 'Yeah but those games are so linear and closed man. 360 can do better sandbox and alpha effects!'
Personally I would say the best looking AND performing games this gen are all on PS3 but they are very few. KZ3 looks amazing and performs very well with zero screen tear. Same goes for Uncharted 2 & 3. The best looking 360 games always have a few niggling issues like sub HD or no AA or some screen tear but they tend to be more open with 4 player co-op and/or split screen and do take advantage of the superior alpha effects the 360 bandwidth superiority can afford.