Devs don't even run the game at highest graphics specs

[normalforce]

Let's be fair here. Yoshi posted a small image of this in his latest Letter from the Producer, people clamored for a larger one, then Bayohne worked his magic (and his many appendages) and somehow procured, as Jinko pointed out, this strange 1675x1043 resolution version. This is hardly an image vetted by PR, produced at the highest quality they could, and presented to us. It was a teaser that Bayohne was able to quickly embiggened for us.

It's not taken at the highest resolution, but we were able to get a larger size of the image to share with you guys. Enjoy!

Click to embiggen!

What does it say about the graphics performance of the game engine when the dev post a semi promotional shot of the game with no AA, Depth of Field and Ambient Occlusion.

It says exactly what any large corporation would do for a team of programmers when faced with procuring computers for them.

Do they get the latest, top-of-the-line, hardware or something more moderately priced? And then how often should those computers be upgrade?

If the dev team has been working on this for the last 4 to 5 years, it stands to reason that most of them are still using hardware from that long ago. I doubt every dev is running this game on the highest settings possible. That's not to say that some devs don't have a machine capable of doing exactly that, just that this image wasn't produced from one of them.