It's Domstang68. Haven't been on in a while, people beat me to writing articles, but I found a fairly techie section in an article that was part of an interview.

Yes we are still using the Quantum 3 engine and as you can see from the graphical enhancements to C2 we are still improving it. The advanced shaders, dynamic lighting and post processing effects gave the Artists a huge amount of control over every detail of C2. Also several tools were created or improved specifically for C2; these quickly became an invaluable part of the Art pipeline and had us questioning how we lived without them. We improved our Wii profiling tools to give us memory and performance information down to the cost of an individual asset or a single shader. Our reworked cell and portaling system allowed us to make much larger and move varied environments. The lighting tool gave us the ability to dynamically light an environment real time on the Wii giving them a more constant and realistic look. In the end one of the biggest reasons for C2s improved graphics is the communication between our Artists and the ATG Programmers. Art and ATG really pushed each other throughout the project and the results are evident in C2.

They are basically saying that the current engine comes down to the smallest amount of computer memory and can tell the exact size that a task takes. This way, they can push the Wii to the max by using all of the memory they can. They also allowed for much bigger environments without sacrificing framerate, detail level, or splitscreen. It sounds like C2 is poised to blow away TCon in every respect graphic wise. Keep it going HVS!!

(NOTE: This article comes from:
http://wegotthiscovered.com/videogames/interview-keith-hladik-conduit-2/)