The look of a game is its selling point. In our market society, we judge a book by its cover so we judge a game by its looks. I've often complained about the looks of characters in some genres.
So let's talk about graphics and realism.
When looking back on some of the earliest computer games, graphics were always the added bonus. For the most part the graphics were iconic. This means they were symbols or like hieroglyphs. The icons represented something else that we can translate in the context of the game situation.
As the graphic abilities of computers advanced the less iconic graphics needed to be. They did not need to be abstract shapes to represent a player or an enemy. It could vaguely resemble what it was suppose to be.
The semblance of what the game environment is and what we recognize as real are slowly becoming closer. The uncanny valley is all we have to watch out for.
On the Trail
Perception is what graphic style or visual style changes most in a game. Let's bring up an example: Oregon Trail.
The first/original version of the game used somewhat iconic graphics. The text log sat under some single color pixel animations of a oxen pulling a cart. The user gets some visual feed back but text was needed to clarify.
A few years later they upgrade the graphics. While it's still a text heavy game. There is now color and images made with pixel art.
Then the game changed a bit and the player is more likely to talk to people and a very visual GUI was introduced.
In one version that I recall vividly was Oregon Trail 3. Photos and live video of people in costume were used.
Most recently, I got the iPhone/iPod Touch version of Oregon Trail. The graphics are cartoons.
Between the 4 versions of the game I brought up we get very distinct perceptions for each.
Iconic graphics rely on imagination and need text to support the visuals. (or in some cases clarify).
While this isn't the perfect example, it's enough to prove a point. The player recognizes a wagon with an ox.
A game like this is taken "seriously". It's educational.
Then we see the upgrade.
While not realistic, it represents semi-accurately what you were doing.
This would be perceived again as something to take seriously and as educational. At the same time it's more enjoyable to look at.
This is a photoshoped looking setting. But the images are realistic. Again this makes the game seem serious but could be considered more immersive.
The most recent Oregon Trail has cartoonish graphics. Which gives it a tone vastly different from its predecessors. It seems goofy and less serious and perhaps more fun.
1000 Words in a Picture
As the saying goes. What do you want your game to "say" when players read the images?
The visual style will say a lot about what your audience can expect. The challenge will be to meet the expectation or to throw your audience in for a loop.
As seen above, a cartoon style graphic can be perceived as "easy fun", "casual", or "childish".
In now times, the iconic style can be perceived as "nostalgic".
The platform you work with limits the range of visual style to apply. PC has the widest range.
The more "serious" your graphics the more critique your game may get for visual and game design flaws. In some ways a stylized graphic game may be forgiven because it's a "cartoon".
However, there are always going to be truly heinous design flaws that can never be forgiven.