I saw these screenshots when they were leaked a while ago, and they are phenomenal. I accused them of being faked, and was assured by somebody working on the game that they weren't. (Can't remember his screen name at the moment, and can't look it up of course since Gone Gold is just plain Gone now). They said the game is running on their desktops, and it actually looks like that.
Now I'm going to be pessimistic and cynical and say that they can't be getting a decent framerate. The workhorse computers they must be running just to develop it have to be much more expensive than the average Joe's, and Morrowind only runs well on my computer
now, it didn't run all that great years ago when the game first came out. If this thing comes out anytime soon (say, the next two years) most of us won't be able to afford computers that could run it decently. Frankly, the developers must be looking at a slideshow.
Which makes me think it will be longer than that before it comes out.

Yeah, I told you I was going to be pessimistic.