[tibbon]

It seems this limitation/concept is something that I haven't seen too much in modern pixel-art. We often see modern pixel art using larger pallets, but just low resolutions.

[nsxwolf]

This is the problem I have with the widespread use of pixel art. Most of it is ignorant of why the old graphics looked the way they did. Like you said it is adopting one of the limitations but ignoring the others.

The developers of Shovel Knight actually emulated the way NES graphics work (and added some enhancements to it) and the result is a much more convincing retro feel.

[bhaak]

IMO this is also due to modern pixel-art actually emulating 16 bit pixel art.

The 16 bit computers already had graphics capabilities much more similar to modern graphics cards than their predecessors.