Whatever it is, it's not THAT impressive - I mean, just look a the cars for example in the domino-video - the "hitboxes" are a lot bigger than the cars themselves, they're knocking eachother down without touching the next one.
It's a lot better than anything I ever saw on the Gamecube. It might not be impressive compared to what a 3.2 GHz triple-core CPU can do, but it's really quite good. Did you see the video with 472 Elebits in a room? Here it is:
http://youtube.com/watch?v=x-j9wA6ilBA
The closest thing we can compare Elebits to is Pikmin, which had I think no more than ~150 characters onscreen and certainly not much in the way of physics. I think that would require more than overclocking a Gamecube by 50%.
Also, probably the best thing to compare the new Pokemon to is Baten Kaitos, since it seems to use the Gamecube pretty well (lots of lighting, particles, depth of field, etc) and has similar-sized battle scenes. Pokemon's lighting and distortion effects go way beyond what Baten Kaitos did...again, more than a 50% overclock, but not necessarily a radical architectural change. I'm going to guess that the capability of the TEV has been ~doubled and it might have more than 4 pipelines for more fillrate. There are a lot of fillrate burning effects in the 2nd gen Wii titles.