Au contraire, the visuals are quite lovely. I like it a lot, simple yet elegant and looks good even on HD res. But that might boil down to individual preferences as I prefer oldschool isometric RPGs to be 2D-ish. The art-style tends to stand out and I like that.
But I played the alpha demo for a bit and it was so damn difficult for me. You can download the Alpha demo off Desura and give it a try yourself but it's an old build according to backers and a lot changed since.
From the moment I entered the tunnel I faced off a few vermin whom seemed quite tough and I'm ashamed to say that I stuck there during the few hours I had played it but I'm sure it was my build that had a few holes in it, might give it more tries in a couple of days as my WoW sub is going to expire and a huge amount of time would open up on my time-table.
Oh, I also remembered that I read about that, skipping combat is possible if you can talk your way out of it or use stealth but I imagine there are large amount of combat that you can't avoid. That reminds me of another game "Age of Decadence" was also in close beta few months back and you can definitely skip combat through the right choices of dialogue based on stats there.
download the public beta from here: http://www.irontowerstudio.com/forum/index.php/topic,2488.0.html