The reason some games look like shit and have problems like dithering/banding is because they're 24 bit color or less
Framebuffering is a big limitation and bottleneck for the Wii. If EFB/XFB (extended and external framebuffers) were bigger we'd have more games running in True Color and at higher resolutions. As it is we often come out with games that are either 16-bit color (like Gamecube games), 18-bit colour (6 bits for R, G, B, the remaining 6 for alpha), or 24-bit color.
A lot of the texture work done for some Wii games is actually really nice. Take a look at some of those games running in the Dolphin emulator and without those framebuffer limitations and you'll see what I mean.
The better looking games -- the Mario Galaxies and so on -- are just using the system more cleverly.
Twilight Princess is a Gamecube game remember. And one that doesn't even look as good as Wind Waker...