Can you explain to me why PD can't make this possible easily while Fallout 3 can render the WHOLE MAP in amazing quality on your screen at once?
I don't know how PD handles the mirrors in GT5 if it uses real reflections or if it "fakes" it, but being that the quality is dropped alot I'm going to guess its using real reflection tools in there animator, and if thats the case the reason it looks bad where is fallout can look good is fallout doesn't handle near as many reflections, and frankly real time reflections are near one of the hardest things for any computing system to display. Think of it like this...
To display reflections you need light, now again this is a computer system so its going to display light the best way it can the light source basically shoots out ..an uncountable amount of transparent lines from it that shine on everything, what these "lines" do is they alter the colours of everything to give an illusion of light. This can be hard enough on alot of computer systems. now lets take these lines, rather then just..existing they start bouncing off objects.
Now there are some objects where its important this is done well, like off the cars to show environment reflections, or on the track to light up a shaded area, if the reflections on these things are wrong it will be pointed out fast and will frankly look awful.
The mirrors themselves are fairly minor in the game...and when you consider all the reflections this game does..and does very well, while maintaining the framerate the game has, you have to start cutting corners in order to maintain peek performance of the actual game.
In short, reflections are very demanding on computer systems, and some reflection techniques still are not able to be produced in real time by a single computing system (the closest I know of is i think the most demanding reflection technique known as Raytrace lighting it was never possible to display it in realtime until a company linked 3 PS3s together to multiply the computing ability and only then they managed to do it, but thats still FAR off from being an ability of the ave gaming system.) Anyways, thats the best I can explain hopefully it was understood, though i can understand if it wasn't, but hope it helps you grasp why Fallout can do what it does but GT5 most likely wont be able to make mirror reflection better unless new reflection techniques are made between now and the release, but i wouldn't hold your breath.