The graphics will look phenomenally better because Skyrim is on a new engine for one.
A new engine does not equate to phenomenally better graphics. Particularly when we're dealing with a company like Bethesda (who, as far as I know, haven't made a new engine for anything since the mid-1990s), it's very possible that it doesn't lead to that at all.
There are also many tricks of the trade developers can tamper with to make the quality of the picture enhanced and more fulfilling. One thing also to consider about console marketing is they never fully use the system to it's potential until near the end of it's life. Considering the consoles are supposed to last for another five years, I wouldn't be surprised to see some nice jumps in innovation, especially graphics.
Er... they aren't expected to last for another five years by most everyone. Well, except Sony, but that's more PR spin than anything - they know full well that they'll be releasing a new console well before then, but it helps sales if consumers don't know this.