I want to say that the increasing cost of games is not just graphics. Nowadays games are almost held to a similar standard of movies...
Not saying graphics aren't important but the methods used to accomplish good graphics or resources needed for such graphic generation is not worth it.
consider something like witcher 2, excellent graphics but i doubt it was that necessary. and see how many bugs were there and how problematic the game was (according to me in gameplay and graphics optimisation).
Not every game has problems when it has good graphics but sometimes whenever time is short, priority is given to the wrong thing. compare uncharted 2 against 3. How many problems were there in 3 which many got frustrated with; read DetroitDJ review on gamefaqs for the full... rant.
Immersion yes, and uncharted 2 reached that level. ff13 tried to reach that level and they did but spoil the game.
note that the reason why next gen will be more expensive is mentioned to be the video creation time. why is it so difficult? is it the music? is the engine that complicated? was the video so advanced? what is the benefit? is it worth it? I am just asking but I don't feel I see that much benefit when you put that much effort. Maybe the engine was still quite new and therefore there was a specialized person for each area in the engine.
then again, why make an engine if there are still so many people required to make it work. engines simplify repetitive tasks and all that.
It's just that I program in php and when I use the MVC architecture, I feel I make my work faster. yet I feel we can improve it by quickly creating queries and therefore shorter times for advanced creation. if we want more features (new) then the mvc 'engine' needs to be optimised even further but as said before, its a process of improving all the time.
if time is increasing with increased features, the engine is failing in one part.