Graphics are very conducive to a good atmosphere.
I subscribe fully to this. Graphics, music and design are all conducive to a good atmosphere.
However, and this isn't directed toward you dtewi, I think it would be rather silly to put any sort of wieghting scale on these factors. I think it's also silly to put any sort of weighting on the comparison of gameplay and graphics - two wildly different aspects of gaming that typically are necessary for an enjoyable gaming experience.
These discussions are nearly always fruitless as they typically are devoid of context (some genres lend themselves more heavily toward atmoshere as opposed to crisp, tight gameplay - the opposite is true of many genres as well. Obviously there is an incredible amount of middle-ground here) and completely lacking in consideration of what the gaming experience means to the individual. Most importantly, nearly everyone tries to fragment games into mutually exclusive aspects and compare them.
Regardless of the medium, you'll always have the Dorian Gray - type. Whether it'd be realism, cartoony, or whatever the taste, aesthetics are the trump card. Several games come to mind, Big Fish - a movie, immediately comes to mind for me. Some may see it as shalow, I however, take no issue with some enjoying (or even preferring) something for simply aesthetic preferences. Some just place more value in that than they do with gameplay.
I think many of us look at this as far too simplistic - which would you prefer? a gorgeous game with virtually no gameplay; or an ugly game with exquisite gameplay. Given the technology we have and our immediate access to information , we're rarely faced with having to choose between two absurd extremes anyway. Frankly, it's a waste of time even discussing it. I think it simply comes down to what one values more to their gaming experience: atmosphere (a culmination of music, graphics and design) or gameplay.
Though it seems absurd to me, at first thought, for one to claim graphics as a more valued aspect of gaming than gameplay, but I think a legitimate claim can be made.