This couldn't have been a real-time demo for the GCN, right?

Yes it was first anounced as an exclusive for the playstation, then for the gamecube and now for the xbox 360.

Correct me if i'm wrong.

No I think you are right. I recently found footage from the PS1 version in youtube. :)
 
Rebirth was used to demonstrate the FMV capabilities of the GC. IIRC, it was MPEG1, but the resolution, IQ, and framerate were good enough that it could be considered a "big deal" at the time. If there is any truth to the claim that they would have done it all in realtime if they'd had the time, they'd have probably just used something else to showcase the FMV feature.
 
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