it's in house made engine. DX11 only, compatible with DX10.1 cards. Works also on older Dx10 cards but might have fps hit.
We use around 50-60 thousand polygons for LodA. Normal maps are supported and used everywhere, lot's of shaders, HDR, real time reflections, real time shadows, blablablayaddayaddayadda...
Here's how screenshots are made. We try to find a very nice place of the track, while a very nice car goes through the replay... we press print screen on the keyboard (or whatever key when using fraps), we then put the resulting screen in the AC logo template and post them around. Sometimes we're amazed ourselves by the results and there are plenty of "do we did this really?" comments in the office
Do we made any compromises in the graphics? Yes plenty of course, but made in a way that you practically never see them when racing. I dare say it looks better when you driving, than when you're taking still screenshots.