Why not? Last generation it felt like 99% of games were using Unreal Engine 3 anyway.
It could have bolstered asset quality and resolution if it cut back on the amount of buffers it was running with.
It's also technically the "oldest". - As Halo 1 and 2 were remastered.
The bandwidth and fillrate that the Xbox One X has... 1080P would be a wasted endeavor.
Well. 1440P is still a benefit to 1080P users anyway thanks to downsampling... And that still gives headroom to dial up the effects or improve performance.
UE3 is pretty great for shooters and did pretty well in some open world games as well. I just don't think it always gets the polish as some in house engines. For example, its hard to imagine creating something like Forza on UE. I also recall a Tony Hawk remaster being terrible on UE3 and had lack of polish that's common with the engine.
You're having it both ways with your Halo 3 argument. You're trying to argue changing the lighting effect gave it significantly more headroom to improve everything else, but its also the oldest so optimization in future games would obviously be better. If anything, lowering the resolution alone was probably enough headroom for Halo 3's lighting. Destiny on 7th gen for example has great lighting effects and asset quality, but the resolution is sub-HD. However, Halo 3 has a very jaggy presentation while Destiny is blurry, so they must have used different post processing effects.
I'm simply suggesting less resources used on resolution is more resources that could be used on other visual aspects. But it also depends on the performance that's being aimed for.
On a side note, I would argue Forza 7 is using the X1X hardware extremely well. Its 4K/60 fps and higher quality graphics settings on top of that. I think Gears 5 is gonna be a game that utilizes X1X very well too. Frankly, I'm sure there are a lot of example of the X1X hardware being used well and it does deliver the visually best ports at the moment.
Gears 5 for X1X (5/5) - Mortal Kombat 11 for X1X (5/5) - Doom 64 for N64 (emulator) (3/5) - Crackdown 3 for X1S/X1X (4/5) - Infinity Blade III - for iPad 4 (3/5) - Infinity Blade II - for iPad 4 (4/5) - Infinity Blade - for iPad 4 (4/5) - Wolfenstein: The Old Blood for X1 (3/5) - Assassin's Creed: Origins for X1 (3/5) - Uncharted: Lost Legacy for PS4 (4/5) - EA UFC 3 for X1 (4/5) - Doom for X1 (4/5) - Titanfall 2 for X1 (4/5) - Super Mario 3D World for Wii U (4/5) - South Park: The Stick of Truth for X1 BC (4/5) - Call of Duty: WWII for X1 (4/5) -Wolfenstein II for X1 - (4/5) - Dead or Alive: Dimensions for 3DS (4/5) - Marvel vs Capcom: Infinite for X1 (3/5) - Halo Wars 2 for X1/PC (4/5) - Halo Wars: DE for X1 (4/5) - Tekken 7 for X1 (4/5) - Injustice 2 for X1 (4/5) - Yakuza 5 for PS3 (3/5) - Battlefield 1 (Campaign) for X1 (3/5) - Assassin's Creed: Syndicate for X1 (4/5) - Call of Duty: Infinite Warfare for X1 (4/5) - Call of Duty: MW Remastered for X1 (4/5) - Donkey Kong Country Returns for 3DS (4/5) - Forza Horizon 3 for X1 (5/5)