The reason they chose to use the Source engine is to hit the 60 FPS mark on current-gen consoles. It's coming out on the Xbox One as well as the PC and both those platforms can easily achieve more than 60 FPS. It looks like they've updated the engine on their own. One thing I noticed is the increased draw distance and size of the map shown at E3.
I can understand wanting to hit 60fps, as that's definitely something consoles should be aiming for. It's just that it's a pretty old engine now - it was great for its time it's starting to get a bit long in the tooth. Also, very few games have licensed the Source engine and we know that Valve is working on Source 2. That said, the footage looked great so I'm not complaining. Looking at the footage I would never have guessed it was Source.
The Source engine is old and its age shows in Portal 2 with loading screen after loading screen.
Yeah, Source has always been bad at dynamically loading assets. It has been surpassed by engines like Dunia (Far Cry 2 / 3) which can handled massive game worlds with virtually no loading screens and with very high visual fidelity (DX10/11).