I quite agree, best to make sure that the base install is working properly.
maxing out the Conf.ini will go a long way to solving most issues, but the fact is that if your just now coming into IL2 '46 your probably going to be underwhelmed by the looks! Its only 13 years old after all.
Id also like to see what you mean by blocky textures, as there are some driver issues that make trees and such look like big square blocks.
But even if it is working correctly, mods just add more icing to the cake. They really do add life to the old girl.