Couldn’t agree more! Games like The Last of Us, Beyond Two Souls, Batman: Arkham Origins, GT6, Sly Cooper: Thieves in Time, GTA5, God of War: Ascension, Bioshock Infinite and Tomb Raider looked like the final supreme version of what came before them in prior years and i wish we saw more for a couple more years on PS3.

Gen 3 and 5. Gen 4 and 7 not too far behind.

I think Gen 6 was the biggest jump, but the progress within the generation wasn't as significant as the top 4. Especially if we're comparing early games of a console vs late games of the same console.

Generation 3, easily.  The Famicom launched with an arcade port of Donkey Kong.  A couple of years later it released Super Mario Bros 1, which is a huge leap forward from Donkey Kong.  And by the end of the generation it released Super Mario Bros 3 which is a huge leap forward from SMB 1. 

The NES/Famicom basically had 3 distinct phases.  Phase 1 was black box era (Donkey Kong, Balloon Fight, Tennis, Golf, etc...).  Phase 2 was the first time a console focused more on making games for the home over arcade ports, and consequently this era created the most iconic franchises ever (SMB, Zelda, Dragon Quest, Castlevania, Mega Man, etc...).  Phase 3 was the end of the 8-bit era, and included a lot of sequels to games from phase 2 (SMB 3, Dr. Mario, DQ 3/4, Castlevania 3, Mega Man 3-6, etc...). 

Gaming had a tremendous transformation just on one 8-bit system.

Ps1 era. The graphics progressed so much during that era.
Tekken 1 vs Tekken 3
Re1 vs Re3
FFvii vs FFix

Gen 4 started with the first 16 bits consoles, then we got things like Star Fox, Donkey Kong Country, CD games like Night Trap, and even an add-on that turned your 16 bits console into a 32 bits console!

As I am writing this, 13 votes for Gen 7 which is 43.33% of the vote.
Gen 7 saw more or less up-ressed late Gen 6 games at the start and had The Last of Us and GTA V at the end at least before replacement when it still got games.
You also have to look at some of the consumer habits and advances.
-Very few people had HD setups at the start of the generation, but that changed by the end.
-Digital distribution of retail games and even a lot of mid or small games was not a thing in 2005 but was popular by the end
-Consoles added streaming apps
-Wi-Fi became essential for home consoles and gaming in general
-Online play was small in the console space but by the late 2000s and by 2013 it was massive.

Speaking of Gen 7, the DS is also worth mentioning. From the original to the DSi, a camera was added, along with Digitalware and a modern home screen.
Also DS did not support Wi-Fi back in 2004, immediately after its release