Ever since the 3DS was announced and we had our first glimpses of the games it could put out with just a few weeks of work, we knew the GPU powering the 3DS would be special.
The DMP Maestro Pico 200 is capable of pushing 15.3M polygons per second, and supports many programmable shader effects as fixed function calls, which simply means it will look really nice in terms of lighting without the performance or power consumption going crazy. Such effects include bump mapping, sub-surface scattering, self-shadowing, per-pixel lighting, refraction mapping, and tessellation, something really only shown in DirectX 11 and OpenGL. In addition, this GPU supports OpenGL|ES 1.1
It's actually quite sad. Nintendo has no experience using such advanced shaders as they simply did not exist in the GameCube or Wii. This is why the MGS 3D tech demo and Super Street Fighter IV 3D look better than Kid Icarus Uprising. I believe this would be the first time 3rd parties are able to make better looking games than Nintendo, but that will never necessarily mean that they will play better/worse.
Here's a couple of videos of the chip in action:
Source - NeoGAF