Their games look crap, not because of a lack of resources but because of a disrespect for visual design (it's not even "art", they could make a better looking game with colored squares). There's probably many, many ways to improve the look that have nothing to do with "AAA art". He fails to see how Baba Is You is a better looking game than any of theirs, simply because it's focused and has a good use of color and contrast. Any $10/hour freelance game artist can tell him that the problem with the games is a mismatch in detail, between background and characters, between resolution and texture detail. This makes tiles look either blurry or covered in white noise and together with a sever lack of contrast, makes the game look flat and unlit.
Solving that doesn't require hiring expensive artists, it first involves acknowledging there's an issue at the core that can't be solved by sticking stuff on top of it. I see zero patience or passion for that and that's why their games look the same as 25 years ago (and I could argue, worse, since higher resolution doesn't do them any favors).
Again, I have no problem with their games and them looking like they do but going into defense here is a battle they can't win. Their best move is to acknowledge that they don't care and do so with pride. Everything else just feels at best insecure and at worst somewhat disrespectful towards devs who care.