I think it depends on the mood of the game... Look at Nights, it has a surreal visual style because it is the dream world. Something like iono WW games should look real though.
In my personal preference though, I prefer games less realistic. If I want to see real images, I don't play games, I go outside. I have enough of reality in real life and I play games to escape it, so I prefer a game that doesn't look like it.







