The impressive graphics (for the hardware) on current gen consoles showns what is possible when going to the metal, bypassing several layers of WDM, scheduler, drivers and DirectX.
No it doesn't. It takes a lot of effort with Cell just to reach parity, Xbox is basically DX9.
You program the GPU by writing shaders that run right on the GPU, the only perf increases to be had involve how fast you can move data on and off the GPU. Eliminating all abstraction might give you a few percentage points, not enough to do anything that we would consider amazing under current circumstances.