The GPU (Graphical Processing Unit) inside the Wii console has only modest-appearing specs. At 243MHz, no computer graphics geek is going to be impressed by the ATI controller in the Wii.
But behind that modest number there is still a powerful engine that, even more importantly, Nintendo has used in some highly creative ways. The results, while not as spectacular as the Xbox 360 perhaps, are still visually very good.
Most objective observers put the quality of Wii graphics at slightly better than the level of the original Xbox, and that seems fair. Since the Wii system is limited to 480p output, and therefore doesn't offer HDTV level clarity, it's only fair to admit that the Wii will never produce stunning sharpness and realism of the highest caliber.
Nevertheless, Wii and ATI (the company that built the GPU used in the console) have teamed to get the absolute most out of a very good chip. Many of the functions that Xbox and PS3 perform in software to the polygons that make up images - anti-aliasing, mapping, and others - is performed inside the Wii GPU itself. As a general rule, anything done in hardware is typically faster than the same function done in software.
But, of course, the bottom line is what do you actually see. There, few who have tried all three systems have any big complaints.
Colors are not quite as realistic on the Wii as on those two competitors' systems, but they are quite good. In fact, many enjoy the more comic book style shades that are part of some games. Jaggies are slightly more visible on the Wii, which provides high quality DVD-level output.
Depth of shadows isn't as rich as those other systems, but is still thick and believable. The lighting isn't as realistic as the highest-end computer graphics, but many games on even the Xbox and PS3 don't offer that anyway. Effects like fog don't quite measure up, but how many games have that?
None of this is to argue that there is no difference at all. The Wii's GPU and associated software do not offer the super-crisp images that the others can. But at a cost 40-50% less than the others, it's a very small compromise.
What the Wii does offer is very good graphics that were considered state-of-the-art only a few years ago. Those fine graphics have satisifed millions of gamers then and now.
To get the most possible out of the system, be sure not to use the red/white/yellow composite cables provided. That will give good results, but not the best since it limits the system to standard TV output, which is below that of a DVD. Instead, use an S-video cable and get the most the system can deliver.
What counts, in the end, is the overall gaming experience. There, the Wii - including its graphics - has nothing to apologize for. That is not only because of the innovative and advanced controller, the Wiimote (which does help a lot), but because the Wii plays GameCube games and more, all the way back to Nintendo 64 and earlier. It offers a huge array of superbly designed games for every conceivable interest.
In the final analysis, the Wii plays on a level field with its competitors and often outshines them.