Epic vice president Mark Rein thinks developers looking at engines for next-generation console launch titles would be best served by sticking to Unreal Engine 3.
In an interview with CVG, Rein said that UE3 can power visuals like those seen in the famed 'Samaritan' demo 'right now', but only on high-end PCs.

"In fact, Unreal Development Kit has all the features that powered Samaritan - every single graphics feature you can do. We could have shown another 30 videos," said Rein.

"We have guys doing stuff on high end PCs that are just outside of the gaming space that are really pushing the envelope there. So that to us is pretty exciting - and you can do that now."
Unreal Engine 4 was shown at GDC to select industry partners, and is expected to get a public unveiling later this year.
“The UE4 stuff is very futuristic. UE3 is really the horse for this year.”

http://www.develop-online.net/news/4...ext-gen-titles