I'm a big immersion player, and - certainly to me - visuals are INCREDIBLY important for that.
Now, immersion can mean many different things - but as far as TES games go, it's very much about feeling like you're actually in the world - walking around and exploring.
As technology improves, we increase our demand for visual fidelity and realism. That's why the T-1000 looks like a joke in Terminator 2 today - and why something like Avatar has set the bar for visual immersion (and little else).
Obviously, the visual aesthetic in Skyrim is HUGELY important if you're an immersion player. Also, I have to say I think there are many of those players in the TES fan audience.
The day/night cycle is a pretty important part of immersion to me, and I'm a big fan of realism when it comes to that kind of thing. However, since I have no intention of playing these games on a realistic time-scale - as in I don't intend to stare at the screen for 8 hours waiting for the sun to come up - there has to be things in place to overcome that.
Personally, I think I'd be happy with a fully realistic cycle - but with convenient ways of passing the time. Just like they did with Oblivion with the wait/sleep functions. I prefer if you have to "set up camp" - but obviously, they need to make SOME concessions, as it would be pretty dull having to actually set up a camp in real-time
A bed-roll and a portable tent would do just fine. I think it would be wise to take that into consideration when designing quests - and I think it best if they stopped making time-dependant quests as much as they did in Oblivion. It was a pain having to "wait" constantly until the person magically popped up at the time you knew he was supposed to.
There has to be another way of making such quests.