This is a topic that I generally have to agree with Abh and company who are on the side of games generally going down in quality.
Now, there are some gamers, like myself, that play predominantly NEWer games...but they don't have fancy (or for some people even recognizable) graphics.
My friends constantly give me a hard time for playing roguelikes, and tend to think that these games are old. In fact most of them I play frequently are pretty recently developed.
So they are newer games, but independently developed and with an extreme emphasis on gameplay and an extreme underemphasis on graphics (mostly due to the fact that these are largely one man projects with little or no funding I guess).
Dwarf Fortress - amazing gameplay, complexity, replayability, flexability....exteneded ASCII grapics
DOOM RL (a cool roguelike dungeon crawl based on the old idsoftware DOOM game! Even has the sound from the old game incorporated)
Incursion (thanks poDelia!!!
Angband, Nethack...etc blah blah
3059 - a real-time sort of roguelike, but SF instead of fantasy, pretty neat. Actually has a tileset for graphics, so non ASCII (but still primitive)
Xenocide (another SF roguelike)
I haven't played a console game with decent graphics in years. I did, however, recently re purchase Bushido Blade...one of the niftiest sword fighting games I've seen.
I dabble, actually, in old point and click adventure games as well, like the ones Sierra used to make. Those are fun times.
Which brings me to what Usephniel brings up about things going a bit backward....with handheld gaming getting to be good (but not yet great) things like puzzle adventure games and point and click style are somewhat coming back. It's a thing I hope to see more of, certainly.
I'm definitely a much more slow paced gamer though. So... I dunno. I loved Morrowind when it came out, because it was so pretty....but I didn't take it too seriously as far as gameplay, though I seem to remember it being cool.
From what I've seen of my housemate playing the new games on his fancy new consoles...they look like fun, but really not much different than an old fashioned dungeon-crawl with much less in the way of dynamic situations with cool solutions that make you think.
Obviously not all are that way, from what I heard Portal was actually cool and interesting, but I don't know from personal or even second hand experience.
How about I ramble on aimlessly some more?