[Bull]

[EvilGenius]

I've taken a graphics course now, and can tell you that's very likely a ray-traced rendering of a single-frame. As someone pointed out, the polygons that compose the objects aren't apparent. This means the developers were either using very complex surfaces that approximate curves with ALOT of polygons, or that they're using a modeling system that can handle real curves. For that to be the case, and to explain the shadowing and reflections, ray-tracing is the most probable explanation.

A buddy of mine has an Athlon64 3400+ with a GeForce 6800 Pro (I think it's Pro--certain it's 6800) and found some software to render ray-traced images. It took him approximately 60 sec to render an 800x600 of a scene of similar complexity to the one in that image. So, until we can do it about 3600 times that fast at twice that resolution (which means 4x the number of pixels) don't expect to see it happening in real time games.
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-EvilGenius V$^PK

[Albino Gibbon]

The developers replied that it is a pre-rendered background with working characters.
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[X.O.Skeleton]

ooo, thats the case
*still drueling* nice pic anyways
a bit of work done for that
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"No gut, no glory"