PS2 had an unusual and unorthodox balance in what it could do, the ports of Silent Hill 2 and Metal Gear Solid 2 were visually inferior to the PS2 version. It had 4 megabytes of memory attached to the rasterizer and that had an -insane- amount of bandwidth for the time, a 2560 bit bus, and it was faster than both the XDR and DDR on PS3. But it was meant as a scratch pad, some people mistook it for something else. Western devs saw it as video memory and the rest as system memory in the beginning. It's an easy mistake to make, 32MB RAM and a 4MB graphics card would seem familiar to PC devs developing launch title in 1999. I think the oddball configuration was beneficial for Japanese devs that were accustomed to non-standardized hardware decisions.
Compare Volitions Summoner to Square's The Bouncer, released within weeks of each other.
Volition weren't 3d idiots, they released Descent before the PS1 was launched in the west, they just approached it wrong and in a postmortem they admitted as much.
When the 360/PS3 generation arrived the tables were turned. It was PC hardware this time on the graphics side. Western devs had years of experience with that. Keiji Inafune gets a lot of shit, for a good reason, and he got lots of shit for saying that Japanese devs needs to look towards the west and learn. That was when the generations were rolling over, and he meant learn as in learn how they do it in my opinion. That's just what I believe but it is known that from his direction came the development of MT Framework, the Capcom engine still used today. They were then quickly out of the gate on the 360 with Lost Planet and then Dead Rising, competing directly with western devs familiar with that type of GPU, while many other japanese devs were holding off trying to get their bearings.
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Being so dominant meant that Sony spent a ton of money on first and second party titles like Ghosthunter, Primal or Dropship. Few remembers those games and they weren't even bad or had a lousy budget and they had plenty of hype because Sony promoted them. Ironically two of those games came out of what is now a Guerilla studio, the maker of the engine that Death Stranding is running on, so it is sort of relevant.
