Texture resolution and shadow resolution do a lot to make a game look better. The big difference between the PlayStation 2 and 3 was the massive jump in texture resolution, shadow resolution and model polygon count. Play Gran Turismo 5 and go look at one of the cars imported from Gran Turismo 4 for a good example. However the PlayStation 2 was capable of some very high polygon count models, as evidenced by Lulu's cutscene model from Final Fantasy X that rivals most PlayStation 3 player models in detail. Those resolution upgrades, the number of objects and not just polygons displayable on screen, and the increase in distance required for low-poly LOD models all made that giant leap possible and very visible. Since then it's mostly been adding camera effects such as depth of field and ambient occlusion that are much less noticeable. Though for those with keen eyes, only in the current generation are there textures without noticeable anti-aliasing effects which came as a result of being able to split the UVs thanks to a higher resolution making small UV faces possible.