I'm a bit mystified by the criticisms of this ITT.
It's an excellent technical accomplishment and MS deserve kudos for this work - I have no doubt that this will also spur similar development at companies like AWS and Google as the kind of compute offloading this demonstrates has applications far wider and more lucrative than the gaming sphere.
The final proof of sucess will be when it goes live into people's homes, and of course there are still question marks over how this would be supported on a game with poor sales that made use of this technique - but that doesn't for one second take away from the technical accomplishment of this demo, and I'm more than happy to eat some crow on this subject as I was very cynical about how this could be done.
Yeah I'm skeptical with regards to how this will all work in the finished product. But I can understand why some people fail to see this as a technical accomplishment. Sure, to them, the destruction physics have improved but not by orders of magnitude better than what was achievable in previous gen. Subtle visual effects like how the debris all interact with one other, which I can imagine take a LOT of processing power especially given the scale of Crackdown, are lost on them.