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Wasn't MSs big selling point for potential developers that the system was fairly simple to develop for, thus making it an obvious choice for development?

If that's true, then that means that it's fairly simple to max the system out, faster than say, the PS3 or the Wii...

And Gears 2 does lack anything that makes it stand out from the first, it still looks good, not exceedingly well though.

I don't think it's "maxed out" yet, but I'd say that graphically, the 360 isn't going to get much better than Gears, as it's the best looking game on the system.