It was! The graphical leap from the PS1 to the Dreamcast still appears to me to be the starkest of the 3d era. And it had online connectivity, out of the box, from day one. Very impressive for the (very late) 1990's.
I bought a DC on launch day, and still have one (my original died). I honestly think ridge Racer 5 looked like something the DC couldn't do. Even more so gran turismo 3, which still looks great.
That said the DC is contender for my favourite console of all time, the PS2 isn't. Oh and the DC still looks great on modern displays, the PS2 looks pretty awful (I'm play on an oled through an ossc).
The Dreamcast as a console was fine. The Dreamcast as a console made by Sega was problematic. Sega had been burning bridges with third party developers for a majority of the decade by the time the Dreamcast was released. There was nobody left to make software for it.
My understanding is that Microsoft built a lot of tech in the Dreamcast in the first place, didn't even need to ask Sega to reuse a lot of it. (I've heard it suggested that the Dreamcast can be considered the first Xbox because of how deeply Microsoft was involved from very early in its development.)