The strange thing is that I spent a lot of time in the beta in the replay theater just zooming in and out of scenery in Powerhouse (things like building exteriors with some background objects) very slowly and I could only discern LOD shifts of certain objects, from more detailed to simpler models (which they've been doing since Halo 2) and could not notice any 3D to 2D shifts. Is it just for objects in the skyboxes or further away? Like spacecraft/aircraft, large scenery (ie. mountains) etc?
As far as I can recall, no one in the beta ever mentioned anything about it, neither did DF in their beta analysis