Draw distance is no great feat. There were many N64 games that had huge draw distances(Legend of the Mystical Ninja, Mario 64, Banjo Kazooie, Major's Mask, etc). Have you taken a good look at how far the draw distance in Mario Galaxy 2 is? It had huge draw distances and superb graphics "on the Wii." That as merely a design choice in Xenoblade. The polygon count and texture quality were all low across the board Xenoblade. There were few texture effects if it used any at all.
Everyone is saying Xenoblade looks good, because they like the game and want it to be associated with nothing but positive attributes even if they don't apply.
Xenoblade was a "seemingly" technically impressive games, but nothing about it was graphically impressive. Same with Muramasa. It used 2D sprites.
People aren't answering the question, what are the best looking games. They are answering the question, which game out of the games that you liked the most do you want to be listed as having the best grapics. There is no reasoning or logic behind their choice other than that they like those games.
