So from my understanding the problem is two fold
1. The art style
2. the technical choices made in combination with that artstyle.
Art style.
Its is clear that they are going for a very Halo 1 combat evolved look, back to the roots so to say.
That is all cool, but with that they took the combat evolve look which was mostly defined due to its technical limitations, and they expanded it with the same restrictions or choices but in a higher resolution game with modern rendering techniques.
This means that the models look very clean, simplified, and almost cartoony. (a bit brutal but almost like Disney Infinity's stylisation of realistic characters)
The models are styled in a very simplistic readable way, with big solid patches of values, and simple recognizable silhouettes which is great for game play, but usually only done in multiplayer games where readability and ability to identify enemies from backgrounds is key. This is def not a great choice when you are injecting it into a single player open world game where you want to be engulfed into the mystery of this big world
The problem the artstyle creates is that everything looks like its straight out of the factory, with many of the detail not found in the diffuse channels but more in the normal/roughness and metalness maps. These are all very deliberate choices and where made to support an art style and lighting improvements will only be able to push it that far.
Another thing, are the choice for the look of the underlying halo structure. Using those vertical hexagonal pillars makes everything look like straight out of minecraft and does not do the game any favors! To me it looks like a way to not having to deal with the broken sections of the halo ring and its for sure an easy way to deal with borders of gameplay spaces.
2. the technical choices made in combination with that art style.
now again the art style is not the main problem. it becomes a problem when you place, it as Alex points out, in a lighting solution that can not play well with these assets and this art style. This kind of indirect lighting can make detailed models look flat and uniformly lit, but then think what that does to an art style that doubles down on that simplified combat evolved look. Its gonna look very unimpressive.
So what can be done as a solution? Better lighting would def help and additionally, this kind of twilight lighting will only be there in short segments of the game. Since it has full day and night cycles, Most of the time it will either be day, or night.
Unfortunately nothing can be done about the artstyle this late in development. as I said, its a deliberate and very conscious choice they made very early in development.
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