I just recently started playing KCD again and the textures are still bad, i wonder if this will ever be fixed or if we just have to deal with it at this point. It’s been more then a year now since release so i won’t get my hopes up high but it’s still disappointing because no explanation is given as to why the textures are so bad ( i play on Xbox one X btw).
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I think it was mostly downgraded. I remember that it was Looking better when it was released
Some of the Textures of the plants got downgraded 
But the LODs from the buildings are better now, not perfect but better.
Actually the mentioned downgrade was done by mistake and was reverted back to the state it was originally when we released. There was no downgrade.
On the other hand we tweaked a lot of things during the whole development. It´s possible that some things looks “worse” for some. It´s all about splitting the very challenging performance budget 
I personally think that the game looks better in overall, yet there is still a lot that can be improved for sure.
Jan Rücker
QA Department Leader
jan.rucker@warhorsestudios.cz
https://twitter.com/jan_rucker