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The trailer looked like it was done with in-game art -- nothing that couldn't be done on the PS3, but given the variety of animations and fluidity of movement, I would have to say it was pre-rendered for certain.

The animations are a dead giveaway, especially in a networked game, where the real thing has to approximate positions a little to make up for lag issues.

Still, Sony 1st party games never look bad. I actually thought SOCOM was pretty decent looking for the PS2 -- its a lot harder to do realistic looking characters than guys in big battlesuits (you can get away with a lot by surrounding a guy in futuristic armor), and SOCOM was not bad at all, even when networked.

I'm pretty excited to see more about this game.