Luke Skywalker's appearance in The Mandalorian season 2 finale didn't look quite realistic, but the accuracy of the CGI is the least important part of his big reveal. Two of the most fervent doubts fans of The Mandalorian have had since the show's first episode have been Grogu's ultimate fate after his adventures with Din Djarin and the likelihood of Luke Skywalker showing up in person. The season 2 finale answered both doubts simultaneously by showing the beloved Baby Yoda meeting his new master.
This level of anticipation was similar before the release of Star Wars: The Force Awakens. The first installment in the sequel trilogy was the first opportunity in several years to know what Luke, Leia, and Han Solo had been up to since Return of the Jedi in live-action. Although the sequel trilogy had its remarkable moments, neither new characters such as Finn or Rey nor classic characters like Luke received the conclusion fans were expecting, leaving many in utter disappointment.
Fortunately for Star Wars fans, Luke's arrival in The Mandalorian season 2 finale gave the legendary Jedi a better portrayal post-Return of the Jedi than any movie in the sequel trilogy. Just as Mando and his team found themselves outnumbered by Dark Troopers, Luke's iconic X-Wing touched ground inside Moff Gideon's cruiser. Concealed under a black hood and with a green lightsaber in hand, a mysterious figure sliced through the Dark Troopers with the same dexterity as Darth Vader in the famous "hallway scene" in Rogue One: A Star Wars Story. The epic sequence only improved when the mysterious figure removed his hood to reveal... Luke Skywalker's CGI face.
Luke's face in The Mandalorian looked less realistic than Leia's or Grand Moff Tarkin's in Rogue One, but unlike their minor roles in the movie, Luke's reveal was preceded by two whole seasons of buildup. All of Mando's efforts to protect Grogu and the invaluable support of characters like Ahsoka, Bo-Katan, Cara Dune, Mayfeld, and even Boba Fett were aimed to ensure Grogu was delivered to the Jedi. Whereas Leia's appearance in Rogue One was a nice connection to A New Hope, Luke's role in The Mandalorian is the cathartic moment the whole series was leading up to.
The use of Mark Hamill's young face via CGI was also a symbolic gesture to fans. The decision not to recast in this moment indicates Lucasfilm understands the importance of the character and the actor after his portrayal in Star Wars: The Last Jedi has been under fire since its release. Ideally, Lucasfulm will find another actor to portray Luke for future appearances, but this gesture to fans indicates the reverence they have not just for the idea of Luke Skywalker as a character, but for his portrayal by Mark Hamill as well.
Disney+ has opened a new universe of possibilities for Star Wars. Logistical advantages like the budget and time needed for a pitch-perfect CGI may not be equal with a big-screen release, but the ease to tell a more intricate and poignant story trumps any technical limitation. Just like primitive special effects weren't an obstacle for A New Hope back in 1977, a minimal inaccuracy in Luke's CGI is definitely not an obstacle for The Mandalorian 43 years and an entire universe later.