I think the way characters currently look is really bland & generic- Au Ra look like E-girls with scales pasted on them so the graphical upgrade might actually make them look like a proper "beast" race. (they're hardly a beast race though.)
The upgrade gives our characters more depth & what was shown is likely not what we will get.(meaning it might look even better than what we saw) I am really excited to see how Elezen & female hyur look with the upgrades because it looks like we will get better ear/eye/skin textures as well.

If the graphic upgrade upsets you, just play at the lowest graphic settings possible.