Yep. I think the simple fact is that SSM is no longer the graphical powerhouse it used to be. Both studios are bound by the same constraints. GG is further limited by having to render a massive open world, and yet they look pretty much a gen apart.
It's possible that Cory took all the best designers and artists with him for his new IP leaving Ragnorak in the hands of the B team. We saw this play out with GOW Ascension and KZ Shadowfall, the A team was busy making new IPs. It's shocking how similar this looks to the first game. I am getting Ascension vibes here and that's never a good thing. I mean they are reusing the main midgard hub world. Oh now the lake is frozen, wow a new texture! Like come on. This is a $70 AAA sequel. Dont reuse anything on principle. When Insomniac did it for Miles they charged only $40 for it.
Even EA devs had Fifa players updated to use the next gen Frostbite hair tech. NBA2k22 completely changed the character models. Insomniac added ray tracing, upped the crowd density by an insane amount, and completely changed the character models. Complete with new hair rendering. All for a standalone $40 expansion. And I dont think even that was enough. Bluepoint has shown that you can have a massively upgraded graphics engine run on top of a last gen engine. Hell, not just engine, the entire game. You can have the same last gen PS4 game AND have Demon Souls quality graphics for PS5 owners.
Horizon shows just what you can do with next gen. Better character models, hero lighting during gameplay, better water tech, better overall lighting, better hair, better facial animations. I would love to see the PS4 version because aside from those changes, its supposed to look identical but i dont see how, and thats exciting.