During the QuakeCon keynote, id Sofware's programming wizard John Carmack made it known that the Xbox 360 version of id's upcoming Rage will look worse than it's PC, Mac, and PS3 counterparts. The reason, according to Carmack, is purely a compression issue and "has nothing to do with the power of the Xbox 360 hardware." The compression needed to squeeze the game onto two DVDs will apparently affect the visual fidelity, and Carmack noted that the royalty fee that a third disc would require is too high. Carmack added that he hoped Microsoft would "make a concession."
Given that Rage is likely to be a very high profile title and that Microsoft has been known to give assistance to developers -- specifically, working with Capcom to accomodate Street Fighter II HD -- it's at least possible they may do the same for id. We're fairly certain the company probably isn't too keen to see a multiplatform title look noticably worse on its platform either. Here's hoping MS sees the light.