Graphics does matter. Usually good epic games have both graphics and gameplay. However graphics does not matter so much that a crappy game is played only for its good looks (FF VIII contradicts all this, I know). I do not see things as a trade-off between graphics and gameplay. RE4, Zelda, Onimusha, Half Life 2 TP have both.
If I was faced with a "chose-only-one" option, gameplay would be the winner. All the above examples are that great for their gaming experiences and not eye candy.
Regarding graphics I think they can only enhance the game experience to a certain degree. Like someone said in a previous post, a pretty game gets old fast without good gameplay. Example: You may add dozens of details in a game like GTA, detailed T-shirts for passerbys, glass and water reflecting things, fingernails, beards and moustaches made of individual hair polygons, nose hair, thousands of random lines for NPCs to say, still that would not improve the game the same way GTA 3 improved GTA 2. Resident Evil 4 is not that much good loking than RE 0 or RE remake, but the gameplay experience make them look as games from different developers.
Satan said:
"You are for ever angry, all you care about is intelligence, but I repeat again that I would give away all this superstellar life, all the ranks and honours, simply to be transformed into the soul of a merchant's wife weighing eighteen stone and set candles at God's shrine."
