I wanted to point this out too. It seems like most people find the game's visual amazing, but I find it quite weird as far as I'm concerned.
The characters do look fantastic, to the point where they almost look like CGI in some scenes. The environments however, and especially everything that's "natural", look very strange.
Everything is a bit too shiny, and the lighting is either bad or weird. It really stand out the most on natural environments, which is probably why this looks more weird than VII Remake to me.
I think it's a mix of both the materials being set up in a strange way, and the lighting giving me a very obvious "Unreal Engine" vibe, which all combines give it a bit of that UE Generic vibe, it lacks identity and everything looks a bit too... Fake? It's a very personnal feeling and I'm not sure how to explain it better.
That screenshot you posted isn't the most flatering, I hope this will be improved, but even the more close up scenes have a weird aspect.
For example, if we compare (compression aside, sorry for the bad quality youtube capture) :
To FF XV :
I think that FF XV looks a lot better, at least it does a lot in my eyes. The geometry might be better in VII, but the lighting, the environment, everything looks and feel more natural in XV, while VII looks a bit more like... plastic?