As someone who was fortunate enough participate in cinematic CG as it evolved to dominate film making,
I've given this a LOT of thought and have come to a few conclusions:
1.LESS IS MORE: Absolutely true, not having enough money seems to always lead to tighter, more exciting, more engaged film making.
2. MIX IT UP: In the pre-computer era, you would always mix models, matte paintings, optical composites , and full size sets so that the audience's eye-brain wouldn't catch on to the weaknesses of any single technique.
3. TRUE MAGIC: My grandfather who worked on the original 'Fantastic Voyage' told me that for some shots the blood cells were Cheerios.
Look carefully at Thunderbirds, Capt. Scarlet, etc and you'll recognize all kinds of household items which masquerade as ships and structures of that imagined future. Doug Trumbull recently revived paint mixing techniques from 2001 to create a swirling cosmos for a modern astronomy digital HD film.
There is true alchemy in taking ordinary things and painting, cropping, and perhaps filming in reverse or up-side down to turn them into something else entirely. Cloud tanks are WAY more fun than running fluid simulations.
Al Whitlock and some degree Peter Ellenshaw were masters at in-camera effects for perfect composites.
See Coppola's "Dracula" - done entirely with in-camera effects.
You have to PLAN these shots carefully to make them work.
4.TOO REAL: It struck me watching 'Voyage of the Dawn Treader' that everything is too real.
This has been the holy grail of film making and particularly computer VFX. But this was a kid's fantasy (with deeper meaning) Everything about the ships, the swords, the locations, the costumes, the monsters, the spirits, was so fully material, that I was getting antsy about all of the make believe story stuff. How did we have battles without blood and nasty casualties? How did we get from point A to point B with no sensible navigation? Where the hell do people go to the bathroom? If you're going to give me absolutely real - I start wanting ABSOLUTELY REAL.
Referring again to traditional matte painting - the best are very rough, just enough to trick you.
5. DIGITAL MET FILM - AND WON When we were struggling to render a few frames of a shiny box, a few people had the vision to see that digital imaging could make whole movies. I don't think that we quite envisioned that they could truly create alternate realities. Most people have no idea that most of what their watching is synthesized from nothing. No set, no model, no camera.
The true leverage is that now an unlimited number people distributed in time and space can contribute to the creation of an image. In the past, only so many people could build, photograph, an act in a film frame. Now, if need be, a thousand hands around the world can do their part, all pre-planned, orchestrated, and combined into an assembly line of dream-forging. If it doesn't feel real, it's because at some level it isn't.
The tactile, textural, visible film image is surrendering to the cool controlled perfection of the digital image.
We have won the battle for reality.
The next battle is to reclaim our humanity.