I don't think the issue is whether or not the game should be photorealistic but rather how it is affecting the development of the game and the gameplay.
Capcom is getting out of a rot and they are, to their credit, putting a good deal of effort into a comeback, if you will. DMC4, although never confirmed, was infamous for having its budget cut half way through to have its resources allocated to RE5's production which for a long time told me where DMC stood in Capcom’s eyes. DmC, however, had a polarizing effect on me because it both reinstated and challenges that believe. Enigmatic, I know, it's part of my charm, children. Seriously, though, in one aspect the production value and cost tell me that they put the money and effort into DmC; hiring a foreign studio, paying them for an entire year just to develop concept, flying staff from Japan to England to Japan every week just to check on the progress. That is both time and effort so it's not like they were dismissive of the project. At the same time, though, this project was so far from all the things that I associate from DMC, and intentionally so, that I most definitely felt that Capcom didn't want anything to do with what made DMC DMC. Both 4 and DmC were huge leaps from the motifs and the spirit of the other games. In the last 3 games staff members always made a point of talking about how they wanted to make a game that new players would get into without having to have prior knowledge of the series and that's why the game is what it is. That's the reason 3 is a prequel, 4 has an entirely new protagonist and DmC is a reboot. 1, 2 and 3 have a visual uniformity, by looks alone I'd buy that they're the same franchise, but 4 doesn't and DmC really doesn't, which, while it doesn't tell me that Capcom isn't half assing the productions of the games it does tell me that they are not interested in trying to make any new potential DMC game resemble the original three.
Tirade about the visual resemblance to the original 3 games aside, here's a little something from more than 15 years ago that's very relevant to this topic. The one thing that people either forget or don't know is that DMC1 was a very realistic game in its time. In fact it was praised for that realism, not just for its visual realism but for Dante's animations and attacks. The way Dante moved was not particularly outlandish, nor were the things he could do. In fact, demon powers aside, the only action that Dante could perform that no real person could was how high he could jump. Yeah, there were fireballs, flying, electrical swords and so on, but the way he shot his guns, the sword moves and the kicking and punching were not something that no mortal man could do. In fact, they were pretty average stuff for it's time considering that most other games of its like had way more over the top action and gameplay than DMC1, though they were not as polished.
Going for a photorealistic look might not be as bad as all that and it's not the first time the series has gone in that direction. The issue is going to be how this approach will conflict with the series' over the top nature it adopted back in DMC3. Yuji Shimomura has made live action movies with his signature action style so it's not impossible to have both, but if it makes the action ingame suffer, that's where concerns should be raised. It's already meant that some aspects that were prominent in the last 3 games have to be removed but that might not be as terrible as all that. If they manage to have a working demo at GamesCom, which is only 3 weeks away, we'll have a better grasp of how the game has changed with this uncanny valley of action in place. Just a little patience.