Folks, I have tested this extensively and i can tell you that it just is what it is. FWIW, I professionally tested devices for a living for several years and do so informally still today.
With the iPhone 7+ isolated lenses, looked at image matadata, etc.. to find the issue.. I also experience the issue with the regular 7 (which threw many of my theories in the trash).
My best guess is that for the 7+ there is image ‘quality’ application being made to the images that goes too far. It is most evident in lower-light (not low light as it can be in light that I normally get good images from with a 6S+) and with the zoom lens.
One at a time..
1. Lower light.. with the Plus model I think that both lenses are being used to create the picture taken and the wide lens, with better aperature, can get away with images that the zoom cannot.. I think the zoom still ‘contributes’ to the image when it shouldn’t be. I think the math is bad for how the lenses are ‘synced’ to create the final image.
2. Zoom.. it’s a miniscule zoom lens and you get what you get.. zoom is borderline worthless IMO. Zoom works when you have something like a flower or subject (better if not a human) that fills the image/screen.. when the image is more broad...say a person taking up less than 20% of the image .. the zoom is worthless.
Finally, on top of these issues you can layer VERY over aggressive noise reduction or image ‘quality’ adjustments in creation of the image. Some, or all of these issues lead to the watercolor effect, the out of focus look and the overly smooth images... toss in the occasional blatantly bad colors.
If you think the 8+ resolves these issues .. well, it does not. I have had them all and I use the 8+ now. I have zoomed in on my son playing baseball and it looks just like the images from the 7+.
WIth that said, other images with the 8+ are WAAAY better than the 6S+ (and I love the 6S+) and the 7+. I hate that the images with the 8+ still have some of those issues but they are there. All you can do is get a different phone (I prefer iPhone so not an option) or understand the limitations of a phone camera. I am not saying the iPhone camera is bad.. I think it is 80% good.. and even 80% amazing on the 8+.. just limited in certain areas.