Switch 2 architecturally is way beyond a PS4 too, its closer in that respect to a Series S. Ampere based with some Lovelace features is going to leave that ancient GCN 1.1 from like 2012 architecture in the dust. 

PS4-XB1 still is a significant part of the audience base if they're willing to not move on from it. 

EA is also bringing Jedi Survivor to the PS4-XB1 ... they must have some metrics that are showing there is a market for it. 

Next generation will be even worse, it will be a complete cross-gen for the entire generation, lol.

"Generation leaps" are meaningless when 98% of the games still look not that different from the previous generation's top games.

People aren't even buying the games that are supposed to be "graphical showcases" that's your other problem. A lot of these games that are relying on graphics to sell are flopping.

It used to be only Nintendo really was making big money in their own niche with lower end graphics on their games, but that has flipped now we are seeing real deal big ticket 3rd party blockbusters like Fortnite (can even run on a phone), Minecraft, Roblox, Genshin Impact, etc. etc. Even things like Baldur's Gate 3 and Elden Ring, these are not what I would call visual showcase titles at all. Call of Duty is the biggest yearly non-sports title for the industry and they are still making the game for last gen.

That's a big difference. Kids these days don't care as much about graphics, it's a preoccupation for a niche audience that frankly is an aging audience. Kids who are used to "good graphics" all their life (ie: grew up with a PS3/360) don't care. They don't want Senua's Saga, they aren't impressed by Alan Wake II, wouldn't give Unreal Engine 5 showcase Immortals of Aveum a shot, won't touch the PS5 only Final Fantasy games, etc. etc. 

Yep there's gonna be loads of games this decade that could not run properly at all on a PS4 but will be able to run on the Switch 2 even if it's heavily cut back and runs kinda poorly.

A ton of people are still playing games on them but the vast majority of those people aren't buying games and are just sticking to stuff like Fortnite. Considering how long it's been since that was announced if nothing is said about it in the coming days then I expect that those versions of Jedi Survivor have gotten cancelled since it has to be a nightmare to try to get that game working properly on hardware that outdated considering its minimum requirements so a lot of effort for little in return. And yeah they surely have metrics but like the 3DS example I imagine some developers/publishers are probably taking longer than they should to move on.

Also to respond to what you said here you're missing that it's not just about graphics. Baldur's Gate 3 isn't pushing visuals but it's still an advanced modern game that could not run on the PS4 and Xbox One due to how much it pushes the CPU. And there's the debacle with the Xbox Series version where even with Microsoft's help they could just not get the split-screen running properly on the Series S due its ram limitations so eventually they were allowed to ignore the parity rule and release it on there with couch co-op disabled on the S.

I think games that aren't driven by graphics appeal like Fortnite and Genshin Impact and Roblox are the future of big brand 3rd party games ... not necessarily graphics driven games. These types of games are largely fuelled by Youtube influencers and social media following and word of mouth on the school yard (well at least that part of it is old fashioned). That's going to be more important than graphics performance. 

Times are changing, graphics in games are becoming like special effects/CGI in movies ... no one really cares that much if you have the best CGI in a movie anymore because what's already the standard looks "good enough" anyway. 

With PS4 I think we definitely crossed the threshold where PS4 games still look "good" many years into the next generation, this will get even worse going forward where PS6 will have an even harder time pushing beyond the PS5 for example. Wouldn't surprise me at all for PS6 for example to see cross-gen periods that last basically the entire generation for more than just a few developers. 

That would make sense since something that can run on low end hardware will have a much larger potential audience. Though there will still be a place for the demanding stuff that pushes visuals or something else. 

There's still ways to go in terms of improving real time graphics but sometime next decade the peak will probably get so close to photorealism that it'll lose its wow factor like CGI has. And I have doubts about it lasting that long since by the early 2030's barely anyone is gonna be buying games on the PS5 but I guess we'll see since I did not expect COD to still be supporting the PS4 and Xbox One for this long.

Wait till more and more blockbusters end up coming out on smartphones. That is whether people want to admit it or not, the largest untapped audience going forward, smartphones are the biggest gaming platform. And eventually the phones are going to become powerful enough to cross into PS5-level threshold at which point a developer is going to face the dilemma of producing something that can reasoning run even on devices like that or spend more to sell to a smaller audience. 

When you're almost 5 years into a generation, and there's like really only maybe 5 games you can point to that have a "massive" (and I wouldn't even use that term ... MGS2 from MGS1 is "massive", Spider-Man 2 from Spider-Man Miles Morales is definitely not) upgrade ... that's definitely not the same as the past.

That we're 3 and a half years into the generation and many games are still crossgen is quite unprecedented; by this point last gen (2017) PS3/360 had been well and truly left behind.

AAA games cost so much these days that publishers don't want to let go of the last gen player base.

Regarding the gaps between gens, I do feel that they're getting smaller as a result of diminishing returns; with the exception of Hellblade II, PS5/Xbox Series games don't look massively better than PS4/XBO games to my eyes. Technically the gap is there, but its less noticeable than in the past cos last gen games already looked really good, to my eyes at least.

The problem is console gamers are still tied to the archaic "generation" classification that isn't fit for purpose anymore.  Games are scalable, there is no reason not to leverage sliders and supporr weaker hardware.

Console gamers are also struggling because they hung their hat on exclusives, which is dying.  And I think it is great.  Why buy 3 pieces of hardware when I can buy 1?  

The gap is there and has a long, long way to go till diminishing returns.  UE5 demos, like the forest and car, are mind blowing.  The big difference between now and the past, panel quality is the limiting factor for many.  OLED, large screen at 120 hz makes games look significantly better than LCD, small screen and 60 hz.  We have entered a period where extra hardware is required to get the most out of powerful gpus.  

And AAA games aren't going anywhere.  Necessity is the mother of invention.  AI tools like DLSS and RT are already here.  More will be coming to reduce development costs.  There are already NPC generators and voice acting AI being investigated.