While I can appreciate all the improvements and am personally excited by what will be possible (acorns growing into oak trees in Fable finally!) I think it will be a hard sell to the great unwashed. Most people don't care if their character's hair is intelligently moving to the character's movement and the in-game wind or if it is programmed/animated to look like it is moving in that way.
Imagine on stage at E3 the tech guy has to explain, "look at this NPC, instead of us telling him to walk along the street and sit at the café table he's decided to do it himself." All the public see is a character who looks the same as this gen do something that looks the same as this gen. They are not going to be ripping out their wallets and spunking $400 on gamestop's counter.
edit because of comments made while I was typing the rest up. The smoother framerate and improved general performance fall into the same caategory as I was describing about AI - that is to say it's not something that makes a great 'soundbite' Games might splutter along now when you play them but this is not the case when they're shown off at events so it is not something that will sell new hardware. I also don't really believe things like this bother most gamers. Remember most gamers pick up call of duty, FIFA, and Dance Central and that's them set all these technical problems games have and are picked over on the net are just not picked up on at all by most gamers.