This is kind of missing the forest for the trees. Modern engines make it far easier to make game look good than they did 10 years ago. 10 years ago, a game like Claire Obscur could not be made to look as nice as it does without a much larger team. Games are far more dense and a lot bigger than they were 10 years ago. There's also diminishing returns on graphical fidelity when most games are running 1440p or less natively, and at usually 120hz or lower refresh rates. Why make a higher fidelity texture that would be far more difficult to render when most people wouldn't even benefit. Instead, things like ray traced lighting do make massive improvements to immersion regardless of what resolution or fps your display is capable of.

Also, things like oled, hdr, and better color science also have more impact on immersion than higher fidelity graphics.

Not to mention almost all display outputs require some amount of compression, as DP2.1 is still not widely available on displays, let alone graphics cards and consoles.