Realistic human faces are the big problem. It's where the Shrek movies are struggling: the humans don't look like cartoons and they don't look real. And, unlike ogres and talking donkeys, we know what real humans look like. Not all computer effects are CGI--computer compositing has replaced the optical printer--and I think people are criticising CGI for strange reasons. They claim that CGO models can't match the feel of physical models, and suggest that to mix CGI models with actors you somehow have to modify the live action (See Sky Captain as an example of that idea). The claim is also made that there is a coherence in film-based effects--we see the fakery, but accept is as story-telling, just as we accept the cuts and fades and gaps in space and time. So is CGI too realistic to be story-telling, and too fake to be real?