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You'd think Xenoblade was made by Gamefreak and not Monoliftsoft the way it's talked about.

I do think that there are sometimes more advanced games that look worse than less advanced games. Bayonetta 2 looks way, way better than Bayonetta 3 in my opinion, even knowing that 3 is a more advanced game built for more advanced hardware. The ambition of Bayonetta 3 was simply too much for the Switch, so the extra horsepower went into places other than having better textures and higher fidelity character models. I recently saw a discussion of Star Wars games where the Youtuber claimed that the ship models in Rogue Squadron 3 were worse than the models in Rogue Squadron 2 because that was the only way the game's greater ambition would work on the same hardware. The Mario and Rabbids games are possibly another example.