People in this thread are confusing photorealism with common reality. Which is why so many seem to be opposed to it.
For me, photorealism means the lighting/animation/materials makes an object or creature look like real. That doesn't mean said object or creature should be a real one like a car or a lion. It could be a weird looking flying vehicle, a sci-fi device or a monster. All requiring good art direction in order to look interesting, they still need photorealism in order to look convincing and believable. An alien creature, monster, etc, still need to react to shadows and lighting in the same way as a lion or car, otherwise they will look fake. That's what photorealism means, something that looks like it could be real. Not necessarily real things that exist in the real world.
Of course, you can have different visual styles that don't aim to look like real but even such art styles can benefit from photorealism. For instance, there's a certain cartoony game that looks better than others and that game is Plants VS Zombies Garden Warfare. That game is obviously not realistic at all, it aims for a CGI cartoon style. But you still get somewhat photo realistic lighting, shadows and materials. This makes it look much more impressive than something like Crash 4, which looks like a glorified mobile game where the lighting seems off and all materials look like the same flat looking plasticky thing.
Another example is the movie Roger Rabbit. Why do you think this particular movie looks so much better than other similar movies where they mix real actors with cartoons? It's because they added several photorealistic aspects on the cartoons themselves. They cast shadows, not only on the environment but on themselves as well. And they generally react to the lighting in the same way real objects do or at least that's what they tried to emulate. The result is something convincing. It's impressive for something as obviously fake and out of this world like a cartoon character to look so grounded in reality at the same time.
This is similar as all those stylized indie games that use pixelated or cartoony art direction but at the same time they use realistic lighting/shadows, physics and particles. You say you like the way these games look because of the art direction but in reality you like them because these pixels and fake objects look so interesting when they are lit with such realism.
That's the whole point. You can still put art direction on the front and create whatever crazy thing you have in your mind but it can still be photorealisitc in order to look convincing. With that in mind, i would say photorealism is very important to me. I prefer a convincing world over a fake one. I mean, that's why we get new consoles and graphics cards every few years. Because making convincing looking games requires power, the more power you have the more convincing the world a developer has in mind can be.
That's not to say older consoles couldn't produce great looking games. Non-photorealistic graphics can still be impressive in their own way. I'm not going to say something like Metal Slug 3 doesn't look amazing with it's detailed pixel art and animation. And even something like Okami, a fully 3D game that doesn't follow any realistic visual rule can look amazing. But photorealistic games can look amazing too, don't confuse the term with the boring reality.
