No texture compression? no problem, just use a bunch of 16 color textures overlayed with transparency.
No AA? no problem, just render the picture several times and use transparency to combine em.
Bad draw distance? no problem, use the transparency of the system to make an impressive fog effect and they will not care about it.
No trilinear, deinterlacing, bump mapping, geometry, multipass texturing, color/gamma adjusting? TRANSPARENCY
Transparency solves EVERYTHING.
And with twice the memory bandwith our next console, you better be using it.