If graphics didn't matter, we'd still be playing 8 bit. Both graphics and storytelling are important.
This is a very interesting statement. Personally, I've been thinking a lot about what the leaps in technology have given us in terms of new gameplay mechanics. Obviously going from 3rd gen (8-bit) to 4th gen (16-bit) did provide us something in terms of being able to distinguish objects and have more objects on screen, but the biggest leap was when we were able to have 3D graphics. Just think of all the different genres that have been created after (FPS, 3d platformers etc.).
To get to the point, since the 6th gen (PS2, GC, XBOX) I feel like we've only been trying to polish what's already been created, that is trying to see how much AA and pixels we can stick up our a$$ thanks to the new specs. As far as I can see, these last two generations the only things we've done are small progress in development of AI (The Last Guardian is a subtle exception), we've tried to create better physics by being able to destroy buildings and not only moving crates HL2-style, and now we're trying VR with the use of motion controllers. AI development probably stopped because of multiplayer taking over. Why care about computers trying to seem realistic when you can just have real humans.
I'm not impressed by how far we've come in terms of presentation in games. I stress the broader term presentation and not just graphics. As a matter of fact, I get really disappointed when I see that in 2017 when I hack or bash someone it feels as realistic as it did back in the 16 bit days where the same animation would play out no matter what enemy you were hitting. Just think of a JRPG where you have a ground enemy vs. air enemy. Same Goddamn animation, but no one expected any different. The next God of War is my best example of this. Just look at the E3 gameplay trailer and you'll see that when he's cutting with his axe at the hulky thing, there's no reaction as if he's just hitting the same way he would when cutting through air. This was excusable back in the 4th gen, but today I'd rather see that extra amount of animation than higher FPS, AA, denser pixels etc.. There's is no excuse for this. We have the storage capacity to allow for more animation.
What I like about Nintendo is that they try to provide innovation, but right now everyone in the gaming industry is confused about where to go for the next step, cuz the last 10-15 years we've only gotten better textures and more polygons.