I wouldn't say MW2 looks awful, quite the opposite it looks pretty damn good to me. Black Ops will look at least as good. Just because an engine is old doesn't tell the whole story, obviously the Quake 3 engine on which modern CoD games are based, has evolved and been updated massively since it was first made.
The console versions won't run at the high res or probably the detail settings the PC version will run at.
We don't know what the devs will do to support this, but we do know it has dedicated servers which are on a single host, which limits if not completely rules out people running hacked servers etc. They also said they will be employing dedicated staff full time to identify and ban cheaters.