It was important to everyone involved that the game feel like the original Halo, and the only way this was possible was to keep the original code. There was then another layer added on top of that code, a proprietary engine that adds modern effects and textures to the game. In an amazing twist, you can hit a button at any time and switch between the updated graphics and the game's original look. The difference is striking, and it's impressive how far graphics have come in the last decade.
The ability to play with the old graphics used to be what the developers described as a "pet feature," a menu item that you could toggle on and off at the beginning of your session. They quickly fell in love with the feature, and wanted to give players complete control over which graphical style they played with. I watched as a Warthog was driven through the water in the old style with very little in the way of details, and then the new graphics were turned on and I could see the water churn.