"We don't pay attention to other racing games"
the other games aren't important enough to get out attention. In other words, our game is better than theirs.
These two statements are not necessarily the same.
I can say at this very moment that I do not pay attention to competing products to what my department produces. I am not saying my competitors aren't important enough to get my attention or that I think my product is better than theirs. It means that I know my product well enough to manage my department in a way to create a competitive product without taking notes from the competition.
I have seen a competitor's product once, and that was when we were reworking our pricing structure, which was based on a different formula than our competitor's, and I had to work out a way to determine if our new price range would still remain competitive. I did not change a single step in our production process, or even consider it.
That doesn't mean that your interpretation is wrong, but you are making an assumption to say that is what he definitely meant. For all we know it was just a response to avoid being goaded into talking negatively about a competitor, which would be disrespectful and/or risks creating a negative atmosphere with Turn 10 team members who could later be working at Polyphony Digital. It could also have been a way to avoid actually mentioning a competitor's name when trying to promote your own product. Heck, it could simply be that the guy practically lives in the office and hasn't had time to play other racing games. There are a million reasons he could have said that, and considering Kazunori Yamauchi does not have a habit of trash talking and bragging, I doubt this was his passive aggressive way of brushing off his competitors as unimportant.
My guess: Since he first began working on Gran Turismo, Kazunori Yamauchi has had a vision of what he wants the game to be. As long as Sony allows him to continue chasing his vision then he does not have a reason to factor the competition into that vision. Sure, PD can look at it, like they reportedly did at E3, and see if there is a different approach to achieving those goals, but creating a product based on a personal vision does not require taking notes from others.
As to the main question posed: I don't really like the attitude that has been taken, but that has little bearing on how the actual game comes out. Until I play it myself I will not judge Forza 3.