> most of reality is pretty dull looking!

This is extremely untrue. It may be true that you spend most of your time in a dull-looking office or apartment, but most of reality -- at least here on Earth -- is quite visually interesting, and games are usually placed in visually interesting environments rather than set entirely within an office or apartment.

Beyond that, I would argue that the entire point of realism is not looking good (although it can look good), but rather immersion. The intent is to transport you to another world and make you feel like you're actually inside the scene. If your goal isn't to do that, then there's no need to bother with realism at all, and you can instead opt for highly stylized graphics that are intentionally designed to maximize aesthetically pleasing appearance and gameplay readability.