Well, to start off, the graphics are not bad when considering some things.
The game is running a locked 60fps on both the TV screen AND the Gamepad. It's something that people do not take into consideration. The fact it's running on both screens, with different viewpoints AND at 60fps? That's pretty amazing.
Just because it doesn't look like it would "Strain" a PS3 or 360 graphic/texture wise, it certaintly would if you had the 360/PS3 hold a 60fps (that alone would be difficult for them), and then also on two screens.
And with all that, it still looks gorgeous. With 5 months or so to its release, it'll surely only keep improving. (Oh and those people complaining about the octogon rings, it's an artistic style, a way of giving a throwback to the series. Cause it is one of Star Foxes most memorable things)
And here's a video of the graphical improvments back from E3 to current.
https://www.youtube.com/watch?v=Kwq22FN2MSo
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