Tesselation isn't a good idea for character faces - you could make use of more polygons for more detailed deformations instead. What you create with tessellation can't be controlled, it's basically wasted vertices for animation.
Naughty Dog already has a head mesh that's very, very dense but I'm sure they could use even more polygons there to get even better control. Also, moving to blendshapes instead of bones would be a good idea to spend extra memory. A smoother nose or eyelid is only visible in closeups but better control over deformations is more visible.
Yeah, then again, KZ3 characters weren't as detailed as the ones in Uncharted or Last of us. Also, the LDR color depth is very very evident and disturbing. They should fix those things first.
I mean this really is pretty damn close to as good as it can get with realtime hardware:
The next big step in quality could come from implementing raytracing for the lighting and shadows and not from more polygons or textures... and of course from better hair (even if this is one of the best examples of realtime hair I've seen)