you are correct. the original is a hi polygon sculpted mesh. screen captured from z brush. a digital clay modelling program
the most current image is a lo polygon game ready model, made in softimage7
the hi poly model has 2.44 million triangles giving it the shape, the lo poly model has (and this is a fluke) 2450 triangles. so about 10% of the original. edit: durr, i'm clearly not a programmer and even worse at maths as 2.4thousand is 0.01% of 2.4million, NOT 10%
in order to simulate the hi polygon models detail we use something called a normalmap. which is the recorded surface normals (which way is perpendicular to the surface) the data is recorded to every pixel in the texture. this means if the pixels don't cover the surface evenly the detail suffers.
you've correctly identified an issue. the detail has been lost...blurred and smooshed together is slightly more accurate. the face still has all those bumps but some of them have as few as 1-2 pixels to represent a "scale" and this is not enough.
to put it into perspective the 1024x1024 texture is 1,048,576 pixels. the original model is 2.44 million triangles. so there is less than half as many pixels to represent the original detail of the model. so some details are lost. even when i use a 2048x2048 texture some details are lost as the head of any creature you model needs more detail than the rest of the body.

here it is again with the hi res and lo res models side by side and the lo res using a 2048x texture for the normal map. it's closer especially in the wrinkles of the eye. but at 16mb for that texture alone,the creature would take too long to load . gamers are a notoriously fickle bunch and will complain about the graphics in one game then complain about load times in others. not realising one leads to another.