Am I the only one who thinks the animation and graphics in the trailer looked like absolute shit? Great cut scenes MercurySteam, with no moving mouths. Horrible looking cel shaded models too.
The 3DS is more than capable of great animation and graphics beyond that. just check out Super Street Fighter IV, you know, A LAUNCH TITLE.
I rather liked the art-style. Nice storybook look to it.
All things considered, though, having a cut-scene model in addition to a gameplay models is a whole bunch more asset work. Thus, I figure they're reusing the gameplay models for the cutscenes, which naturally won't look as good as SFIV models due to the fact that a typical SFIV screen has two models and (rather simplistic) backgrounds, while Mirror of Fate is going to have to handle, at any time, a multitude of enemy models, a fairly elaborate environment, moody lighting, in addition to the main character.