I believe THE most beautiful game on the xbox is Otogi: Myth of Demons. Of course, Dead or Alive: Xtreme Beach Volleyball runs a close second, but for entirely different reasons. Otogi has got excellent models, scenery, and a wondrous use of color and light. It simply amazes at every point. The battles are flashy, stylistic, and very engaging. This game does not sacrifice gameplay for beauty.
It can also be a great hack and slash. On some levels, there is significant respawning going on. (I forget the level, but the one with the wizard yelling out, "None Shall Pass!" is the best) You can seriously sit there for 30 minutes just cutting down the monsters to level yourself up. When you're done, turn around and give the smackdown to the boss.
The main character has got some excellent jumping, and the gliding... Wow, the glide! His clothes flutter in the breeze as he descends across the level. This thing oozes style. And then you have the levels with big crystals, and the one with monster blobs, and the nifty chrome skulls, and ... Fine. I'll stop.
I played Otogi straight through. Then I played it again, all powered up with my kickass weapons from the frist play through. Rock.
And the best thing of all? Otogi 2 is coming out in October. Hot frickin' damn.