There is a difference between outright turning off features, and the overall artistic look of a game. Removing shadows makes games look worse,
but that doesn't mean that bad looking games somehow run better. What you're suggesting by saying "bannerlord has too many NPCs in it to look like the Witcher" is that someone in the development team made a decision to make uglier textures and reduce the colour coherence to make the game run faster. That's the equivalent to painting flames on a car to increase its max speed. Optimisation doesn't work this way at all.
I'm glad you picked The Witcher 3 because that's a good example of a game where the art direction is far, far more important than the texture size, the shadow quality or the graphical techniques it relies on. For instance, for a third person game released in 2015 it actually has some pretty bad or mediocre environmental modelling and texture work -- some of it is worse than warband.
And if you look at some of the individual stuff in the screenshot below, it's also not that great. The tree is a blotchy mess, the resolution of the shadows is pretty low, and there isn't any subsurface scattering (light passing through the leaves). The sand texture on the left looks awful.
But none of that really matters because the main thing carrying the game's look is the colour composition. The quality of the technical stuff doesn't really matter at this scale because the main thing you're seeing is the striking contrast between colours. This is what makes games (or paintings, or films) look good. Not the raw GPU power.
If you think I'm talking out of my ass, here's a screenshot of my game which runs at a comfortable 60fps right now:
The thing preventing games from having 10,000 troops isn't the graphics, it's the CPU.