I do admit they have done some amazing work with the shaders. It is most impressive, but everything else is just average (somethings even below average)...
Engine design today is just awful (not just Crytek, but every mayor player including Carmak and the rest). Engines are very limited and most of the development goes into graphic efects which in my opinion shouldn't even be part of the engine.
Consider this graphic engine design and compare it with how things are generally done and then make conclusion if thing that Crytek is doing is advance or not:
Don't get me started on physic engine limitation, network limitations, spatial limitations, logical limitations... It will newer be able to run a game with land-able dynamic planets big spaceships and some decent multilayer (I expect nothing more than peer-to-peer MMO in completely dynamic world with out of scale objects). Basically it is designed for small things - small static levels where you can only shoot at things and that is all you will ever be able to do...
- graphic engine without limitations - fully generic graphic engine (doesn't try to understand the data just how to send it to the graphic card) - can be written in less than 2000 lines of code and there you go, you have the holy grail of engine design and no one will ever be able to write better (DX11) graphic engine. You can send it voxel data, triangle meshes, sparse voxel octrees, + anything else that will be invented and you newer have to change a single line of code because the engined doesn't care about the data - it just cares about the rules for calculating appropriate rendering technique for the supplied geometry data, material data and render mode (lighting, depth, color, z-prepass..) - all this + the shaders can be put in game data (not engine). NO ONE DOES THINS LIKE THIS - everyone is harcoding effects/passes into their engines which is too much work and more and more limited. I hate when they do tech demo of some new graphic engine and then spend 15 minutes showing graphical effects. The moment they do that, I know that their graphic engine is crap. Instead, show my how flexible it is - will it be able to run something that will come up in 3 years from now without me having to "heavily modify it" (I hate when they say that) or buy new version of the engine.
- Camera Space Shadow Mapping was developed as a single line of code implementation for shadow that will never fail you and will work for every case (even big pointlights). Basically it is just one function that generates 3 shader parameters. If at one point in time we decide to user sparse voxel ocrees or something else - no problem - in our shaders we just ignore those 3 parameters. With other engines multiple shadow algorithms are implemented and they take on most of the graphic engine code that will eventually be obsolete. The moment you implement some other shadow algorithm (cascaded, cube, volumes...) you've made assumption about how things will be render and that means that your graphic engine is not generic any more - it is not all-powerful and it will soon be full of old useless code....
There's this thing called research (theory, lots of papers) and then there's the reality (practice, lots of games)... everything you mention is very good in theory, but sounds to me like crap in practice. You CANNOT create a top-quality and top-performing engine without optimizing for specific purposes OR you end up not making an engine at all... that is, you just invent another API layer, which is what DirectX is. Like with GUIs, one solution rarely fit all problems, so far GUIs can be either retained and immediate-mode, neither can be considered best... and both can't be unified or implemented by the other without sacrificing something, to some degree.
The visual quality and performance of crysis is testament to the work of skilled developers and engineers.
Could it be improved?... certainly could.
Would it be improved by making the entire 3D engine generic?... no.
EDIT: If your solution to a problem is to describe the entire problem, then you haven't solved the problem. That is, if your solution to making a 3D engine is to have it support every single game type and feature equally well... then the only thing you have done is add another layer of abstraction, with some degree of performance degradation.
Doing a lot of web development, I often hear people cry and call murder over rounding corners with images "it's semantic garbage!" and then proceed to convince everyone that people with browsers that don't support rounded borders get what they deserve. Which is rediculous... sacrifcing quality, end-result and often performance for some "very nice in theory"-argument about how things must be made... rather than just solve the issue, "make rounded corners with images".