Yeah graphics can improve a lot. Seeing how PC games are far ahead visually and technically and yet there is tons of things to improve. And by a significant amount to. I nthe future they should implement more stuff like obejct motionblur. It can make a dramatic change to the experience and animations, amongst other effects. Not sure about TR's motionblur (xbox360 version) but say in Crysis, disabled versus enabled takes the animations/movemens to the uncanny valley. And greatly enhances gameplay experience for example.
Full-HD/ultra(?) HD resolution, 60fps, 16xAA etc couldn't replace this.