The answer to the thread is YES, YES, YES.
Graphics technology will not be getting any better, we have more or less peaked.
Making a big, cinematic 3D game is one of the hardest things to do, the number of different skill sets required are pretty much unmatched. The logistics of putting a big game together is insane.
Games take too much time to make, have become too expensive, and even now tons of games don't even pull a profit. This generation has already had loads of studios (fantastic, talented studios) close because the HD generation screwed them over.
The Samaritan demo is pretty, but that's just because it's more polished. All of the technology in it has been put into games already to some extent, for example Bokeh DOF is in Just Cause 2, Sub Surface Scattering is in Metro 2033. The only real difference is that it's a COMPLETELY authored demo, so every aspect could be at the highest fidelity possibly and be polished to hell and back.
It took them apparently 3 months to make the assets for that tiny demo, never mind the research behind it. How long would a typical 8 hour shooter take?
The demo itself ran on 3 cutting edge 580 GTX cards in tandem, that is INSANELY expensive. Even with graphics cards moving forward as they are, no single card will even come CLOSE to that for years.
The next consoles can't afford to wait that long, especially with the Wii U coming out. They will have to launch soon, and they can't afford to eat up debt like they did this generation.
The PC used to steamroll consoles visually, and that isn't the case anymore.
Crysis 2
Witcher 2
Battlefield 3
All of these are on the 360 which is practically ancient. The only game that ISN'T on consoles is Crysis 1, because the consoles simply can't handle the scale of the levels at that fidelity (nowhere near enough RAM), Cryengine 2 is also less optimized.
What the PC HAS been able to do is run these games BETTER than the consoles with sheer brute force.
So what I'm saying is what we will see is far more polish than we are used to this generation, games that run at a more stable level (maybe even HD as advertised this time ¬_¬), bigger worlds, better use of shader effects and supplemental technology like motion capture (like in LA Noire) and realistic physics engines.
We are already at the edge of photorealism, and the next generation is about EFFICIENCY.
All of those saying that the Wii U is going to be oudated? HAHAHAHAHAHA