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When will graphics reach the limit? will gameplay reach the limit?

Now with the next-generation systems out the battle can begin, but with PS3 and Xbox 360 boasting superior graphics. I just wonder will there be a breaking point where a certain limit is reached? Will graphics advance again to the point where u look at ur ps3 or xbox 360 and say " I can't believe I thought Halo 3 look that good" and store it away? When Playstation 4 and xbox 720 come out j/k what will be the new standard? Gameplay is always the most important factor as Nintendo always has put that first taking focusing more attention on gameplay then graphics. And what will become of our good old friends PS2, Xbox and the gamecube with the backwards compabatility will the these systems die and wither away? Will Virtual reality be the next step forward? And a futher prediction.... your opinion as of right now.... what system will hold the crown in 3 to 4 years? And will PS3 and Xbox 360 truly deliver us next-gen moving games or just great ps2 and xbox games from last-gen with pretty graphics will these new systems push the enevlope? I have lots of questions..... give me some feedback......Thx