In truth, when compared to how great character models can be, they look pretty bad. I still personally like them. Especially Elma. Hers actually looks really good. Obviously yes, you can change the avatars eyes, but the default eyes suck and make him look bad. Point is, the models aren't bad. But when compared to others (such as FF15's) , yes they are.

I don't think the problem is model's quality,It is the art design.

The chars could have 100k polygons and would still look "creepy".

That picture is actually from the 3DS version. That was kind of cheating, spem.

I think they look great. I'm very happy with them. I understand what the others are talking about, but for me it's only the female party members that look a little too "doll-like". And even that I'm quickly getting used to, the more I see them. All of the male characters look great, in my opinion. I just don't get why people are obsessing so much about it. The faces in the original were the weakest part of the game, graphically, but it didn't hamper or hurt the experience or story-telling for me at all. This game won't be any different.

There's clearly a huge improvement between Chronicles and X faces. 

People are only bringing it up now, because of the outrageous amount of hype behind it. No one knew or cared about Xenoblade until well after release.

Honestly though, the faces shouldn't be the main fuss. It's just the most obvious.

If it is, I couldn't tell, as they're pretty much identicle.

You really can't tell?

the loli black haired girl looks like a creepy doll but the rest are okay I'd say, I actually like Elma.

They are now, but not when Xenoblade 3D was revealed. Which is where that picture came from. Notice how the grass is gone in that image.