I'll add my observation that action movies and games try to evoke a particular feeling (that feeling that causes you to exclaim, "that's so cool!"), and that feeling isn't just from violence. For me, watching an awesome, well-choreographed dance routine evokes a very similar feeling. (And you could probably argue a good kung-fu fight scene is essentially a well-choreographed dance.) If you ever watch a James Bond movie, they're essentially packed with stuff intended to evoke this feeling of coolness, including, but not limited to violence. You'll see parkour, extreme skiing, sky-diving, etc.

I'll also note that most mainstream action movies and games tend to de-emphasize the goriness and injuries from violence (although gore-flicks also exist, especially in the horror genre). Compare a James Bond movie to a more realistic depiction like Saving Private Ryan. When James Bond shoots unnamed bad guys, they neatly fall over with minimal blood. When he blows people up, you don't usually see any blood or dismemberment. They just get thrown by the explosion and lie dead (but intact) on the ground.

My guess is they do this because the audience isn't watching for the injury aspect of violence, and gore can turn off some viewers. I think the violence in action movies (and games) is more about the protagonist winning. It's the competitive aspect we like. The power fantasy. The protagonist showing incredible skill.

As for graphical realism in games, I don't really know of any that specifically focused on making the killing more realistic (I'm sure some exist, I just don't know them). I've seen games advertise realistic lighting, shadows, reflection, environments, water, faces, gun models, etc. When they make everything more realistic, the violence may get more realistic along with it, but it doesn't seem to be the main focus.