gah. I hate this "DS" comparison that gets chucked up every time a game has graphics people dont like.
Seriously, the only way the DS could do a screen like;
http://www.cubed3.com/media/2007/September/jesusraz/king5.jpg
Would be if the backgrounds and houses were just static pics.
But even then a DS certainly couldnt do that degree of AA, nor Texture filtering, and especialy not the subtle but nice depth of field in the image.
Its certainly nothing a gamecube couldnt do, and thus not using the Wii "to the max", but the graphics are certainly quite nice for the purpose.
The only changes Id make would be more irregular ground, some subtle atmospheric overlays, and (if possible) cloud shadows over the landscape.
oh, and completely redo the dragons breath effect.
This isnt a realistic game, but neither is it Paper Mario, that effect looks out of place.