While it has been pretty much proven now the Wii U is 160 shaders vs the original 320 rumor the architecture differences shouldn't be understated.
The difference from the 7800 based RSX and the HD4000 is still rather massive even with the 4000 series being really old hat now in the GPU space. Just purely on the base instruction set there is a GAP. Granted the Wii U lacks raw FLOPs, but it's amazing what a modern instruction set can do. Just look at under powered mobile with modern instruction sets.
PS: Biggest Wii U downfall is the extra RAM for better textures and stuff being held back by the lack of quality AA to help IQ.
True true, while Xenos was definitely ahead of its time, and beyond DX9 in some regards, just having a card with DX10.1 equivalent features is surely allowing for better results.
Other things I forgot to mention or didn't go into enough detail: Nintendo has a pool labeled MEM0 handling certain tasks in the background and actually, Wii U's accessible DDR3 RAM is
more than twice the main RAM in PS360, due to a portion of the latters' RAM being allocated to the OS. Also, as I mentioned, there are many small caches on the GPU which are larger than those in Xenos (if they exist at all) and probably also faster - texture cache (L1 and L2), local and global data shares (supposedly not used in first wave of software and unknown if this has changed), instruction cache, constant cache, and so on. These are not specs which console warriors typically use as ammo, but they do matter.
The lack of AA is a bit of a downer, and I hope Nintendo can come up with a decent shader-based solution or use MLAA from AMD, as some third party titles already do.
Edit: Something I didn't mention (was trying to not get too technical, but whatever) is that Wii U has half the texture units of 360 (8 vs 16). This would appear to put Wii U at a disadvantage, but something must be balancing it out, whether it be the texture cache or more modern design. The lower number of texture units along with lower bandwidth to DDR3 (12.8 GB/s) appears to make sense from a balance/efficiency point of view. We need to ask where developers were running into bottlenecks with their last gen engines. It was most likely memory size in many instances, which Nintendo addressed. However, it should be noted that in multiplatform games, "alpha effects" such as blood splatters, tree leaves, and shadows have been paired back in Wii U versions. This
could be a result of the texture unit deficiency. Surely, with more experience and time with the hardware, better results could have been achieved. If everything were on par, however, the games should just run without anything needed to be cut. Documentation may have started out poor, but the system was not designed to be "quirky." It simply has its pros and cons, and with more experience, the cons should be able to be ironed out somewhat.