Sometimes, graphics aren't everything.
What makes the old Shenmue games look amazing still, isn't graphics. It's the art direction completely dedicated to making a game world come to life.
In the Shenmue 1080p pics by Kyodai, there's even more proof of this. That art direction is clean as hell. It's the AESTHETIC of Shenmue that still looks amazing even despite the fact the mouths don't actually move when they talk in Shenmue. Even if the graphics were ps3/360 level but with this same art direction, it'd look amazing.
Other games during that time period like Metal Gear Solid, or Sonic Adventure, slated as having great graphics when they came out look highly dated now. Why does Shenmue 1/2 look amazing still? Art design, aesthetic, and attention to detail. The colors, the "scent" that Yu talked about before. The fact that the locations look lived-in, and actually like you can tell people have been there and aren't just random assortments of shit. That every place and location seems to tell its own story. In gaming, aesthetic > graphics any day of the week. It's why a game like Gears of War looks aged, while a game like Shenmue 1/2 still draws you with its fully realized world.
Similarly, Silent Hill 3 STILL looks amazing.
Final Fantasy XII STILL looks amazing.
Dragon Quest VIII STILL looks amazing.
Jet Set Radio STILL looks amazing.
Why? Because aesthetic > graphics, and always will be better.
Personally, even if they went with ps2 level graphic models - which they aren't - and still had the art design and detail of 1/2, I wouldn't complain a bit.
Not worried at all.
In Yu, Shenmue, and that amazing team we trust.