To be fair, when people were saying that, they were mostly referring to super early 360 games which were mostly PS2/Xbox games boosted to HD (which would've been lost on many as most people in 2005 were playing on SDTVs) with maybe a few extra effects thrown in, and stuff like Perfect Dark Zero and Kameo which both originally started development on Gamecube/Xbox and rather ugly art styles that didn't best showcase the power of the 360.

Once Gears of War rolled around in 2006 the leap over even the best of PS2/Xbox/Gamecube was absolutely gargantuan, and it only grew as the gen progressed and games looked better and better.

Heh, maybe.  It might be that I'm impressed by different things though.  

Part of the diminishing returns in generation 8 is that higher resolution can make things look worse.  Like I played Spider-Man last year, and the city looked beautiful but the people looked terrible.  The people were more detailed and such, but the higher resolution pushed the people into an Uncanny Valley and so they looked kinda creepy.  On the other hand Breath of the Wild went with a more cartoony style and I never had any issues with the people.  On top of that one of the few advantages the Switch has is draw distance.  Things look exceptionally crisp and clear at a distance on the Switch.  In Breath of the Wild this means that I could see Mount Doom on the other side of the map, but then later I could actually visit and interact with that place.  I had never had an experience like that before, and in this case the graphics were an enhancement to the exploration of the game and not just eye candy alone. 

Breath of the Wild used better design instead of better horsepower.  I am impressed by the better design, because it actually created a better game.  More CPU/GPU power can ironically make a game worse, because of the Uncanny Valley.

Way back at the end of the Gamecube era. PS3/X360 games didn't really impress me that much, then at the end of their time neither did PS4 or X1 games. Graphics have been sufficient for a long time now

Pretty the much same thing with PS4. Once the order 1886, second son, horizon, and god of war came, pretty much The majority was in agreement that the leap was huge, and sufficient. With the PS2 this was not the case at all, it was being compared to dreamcast, Not ps1/n64 just to show how big the gap was. People online were saying it wasn't a big enough leap over dreamcast.  That all ended with the MGS2 trailer which blew every dreamcast game away graphically at the time, kinda the same with order 1886, Everyone jaw dropped saying it was CGI level.

You can't have a serious conversation about graphics when you say higher resolution makes things worse, its's honestly the first time i have heard  a opinion like that. You seem not to be into realistic graphics, which most games that push the envelope are aiming for realistic graphics so i guess it makes sense. It is impressive being able to that in zelda, but we have seen that before on 360/ps3, and most games are doing that now.

PS3/360 ports aside, I wouldn't say PS4 improved all that dramatically over time from a graphical POV, not anywhere near as much as PS3/360 anyway. Killzone Shadowfall was a launch title and still holds its own visually today, whereas five years into the lives of PS3 and 360 all their launch titles looked like trash.

I actually first noticed it with Gen 6 consoles. They were huge upgrades from PS1 and N64, but they didn't look "just like a movie" which was the unrealistic expectations we had of the primitive 3D graphics at the time. Since then, each progressive generation has had noticeable but smaller returns. PS3/360 games were another (slightly) smaller leap up from Gamecube and OG Xbox, which improved over the course of the generation, and Gen 8 has seen its leap diminish as well.

Don't get me wrong, games from the middle of one Gen to another are still obvious upgrades. We are nowhere close to the limits of how good games can look, but we are reaching a time where improvements in visuals are mostly in the fine details now - and not as over-the-top impressive as, say, the leaps from 2600 to NES to SNES to N64. We saw so much happen in that time frame that everything that's happened since 2000 seems to be at a much slower pace.

Killzone Shadowfall  looks awfully dated. This in a genre that mainly pushes for 60fps, by one of the best graphics developers in the business. Star wars looks nearly a generation  ahead at 60fps to boot.

As great as DICE's games look, I still think Shadowfall holds up very well and the gap is overall quite small,

compared to the absolutely massive gap between early and late PS3/360 games.

I'm on my phone so trimming down the post is not worth the effort. I just wanted to say that the PS2 and Dreamcast are from the same generation. People may have said "The PS2 isn't a big enough leap over the Dreamcast" at launch but the Dreamcast launched with Soul Calibur--a HUGE leap over Sega Saturn, PS1, and N64 graphics.

This is a FPS, and honestly looks like a cartoon compared to the dice FPS games running mostly at 60fps, So this is a stylistic choice which look better while requiring less usually to do so. Those type of games tend to hold there visual appeal longer  compared that to let's say the first uncharted on ps3 which still holds up to later ps3 games. On PS3, not one third person game looks better then uncharted original  targeting 60fps on ps3 to this date.