how did they choose the engine?
why not choose the best?
is it money?

They developed the engine themselves while designing the game.

the best engine is the engine most suited for the game.

clearly they thought their own engine would be the best engine for the game, seeing as they've got a lot of experience with it and they're familiar with how things work.

They have experience already they know what they need. I have the impression that Bethesda is rich, Oblivion sold well, Fallout sold well, I think if the team asked to buy a new engine, the company would have bought.

At a very basic level Bethesda seems to want an engine that can maintain a large open world and a fairly high level of interactive clutter. Most games don't do both, they either have a large world that's relatively low detail (with most objects nailed down as scenery) or they have a high level of interactivity and clutter but with the game world split in to small levels and maps.

Even with Morrowind and Oblivion their engines were largely home grown, NetImmerse/GameBryo was primarily a graphical engine and it was specifically stripped down to allow developers to modify it and build upon it to meet their personal requirements.

the best won't run on xbox360 or ps3.

How does one declare which engine is the best?

There is no 'best' engine. It's the same reason everybody own different clothes.

*Cough* cryengine 3 would have been pretty cool to see *Cough*

as long as its not gamebryo, i dont care what engine they use!

Its simple.. todd and gang had a big wiffle bat to the ouchie duel... winner got to pick.

So what engine is the "best" for large explorable worlds that can handle thousands of NPCs and generate random quests, among other things?

Not suited for big open worlds.

Hopefully the Creation Engine.

Crysis 2 doesn't look all that spectacular to me, not nearly as much as Crysis 1 did. It might even look worse?

Games developed with the Cryengine 3 also need to adhere to the specs of the hardware it needs to run on.

They did not choose, they made it themselves.

And there's no "best" engine.

They may be rich, but all that money goes to the people who invested into the game, paying for the next, and R&D. I doubt the employees and owners are 1/10th as rich as most people assume.

Tru.dat. I work at Dell, and I probably make more than the average Bungie employee that worked on Halo: Reach, for example.

i was just saying there might be better ones in the market

I doubt it. There's one thing that's universally known in the game industry: You always have a better engine for your game if it was made in-house.

In my opinion the real competition this year is The Witcher, not Crysis.