Well maybe.Graphics in screenshots are definitely experiencing diminishing returns. I still think there is a lot of meaningful improvements to be made but it could be a slow road ahead of us. To a lesser extent I think the same thing applies to cutscenes. Death Stranding has some incredible looking faces at times and with mocap there is already an "objective source" to drive the scenes.
I also feel like I've had kind of the opposite reaction.
Starting with Uncharted 2, I've felt like games don't really need to get better than that. Still feel that way after playing it a few weeks ago. Felt like my personal tipping point. Not that I couldn't imagine better graphics, just that I wasn't going to care as much about improvements.
Dynamic gameplay related elements have the most room for perspective shifting improvements imo. Examples include vegetation reacting physically to movement instead of faking it, high res fluid simulations for water interacting with the player and land, better AI, procedural audio, destructive/reactive worlds, npc variation, improved dialogue driven animations, etc.