THe 2d concept art is pretty cool.

You shouldn't stretch the terrains like that. If you must have high mountains, then use a model and map it so the sides look good. You can regiain some of the performance hit by crunching the models and using LOD. The character models are good for a hobby project.

The levels need better static lighting and use of detail blocks. If the textures were not so bland it would help, however good lighting would help to hide that.