Shomp IS talking about the E3 trailer. It WAS a pre-render, but it was based directly on the assets shown in realtime at a later date (at the Sony PlayStation conference held in Japan during the summer). People were point out that the hoses on the Gundam model were "too round" to be realtime and that they forgot to "polygonize" them...but it turns out that the models are the same.
The version of the demo shown playable was built on the same assets, but ran at a lower framerate and featured downgraded shadows. However, it wasn't even a game. It was just a random street to walk around. VERY early stuff, but even in that form, it was looking very detailed. The fact that it is from Bandai is really impressive, as they are typically not known for visuals (hell, they typically deliver UGLY games).
Basically, the point was that the E3 demo was a suprisingly close estimate of what the PS3 could actually render in realtime. Perhaps this will hold true for other demos? Just wait and see...