I think photographic prints, like digital C-prints from a Lambda printer, have a certain aesthetic appeal that many photographers who are used to photographic prints from the film age enjoy. There is something to be said about the aesthetic of a photographic print...the luster, the color, and the tonality. From that standpoint, "better" is really a matter of personal preference.

From a technological standpoint, I am not sure that photographic prints are really better than pigment-based ink jet prints. In past research of my own, from a longevity standpoint, photographic prints (such as Digital C-Print from a Lambda) falls in the 75-150 year range assuming proper storage. Photographic prints only use cyan, magenta, and yellow dyes, so gamut is intrinsically limited, and the dyes last about as long as dye-based ink jet prints.

In contrast to Digital C-Print with a 150 year longevity, with most acid-free natural-fiber papers, longevity is in the 125-200+ year range. Modern pigments used in ink jet inks are emulsions that contain very fine pigment particles, as well as a shell that improves the inks stability, reduces bronzing and metamerism, and supports better reflective index (thus supporting a broader gamut). Modern ink jet printers also use more than just the CMY dyes that photographic printers use. In the case of Canon, you have pure red and green, as well as photographic cyan and magentas, gray inks, etc. Epson also provides gray inks, on top of a deep magenta and orange inks. This expands the gamut into areas where basic blending of the core CMY colors cannot reach. The use of gray inks, often in multiple shades, also allows ink jet printers to produce very fine, smooth tonality in pure B&W prints (which, BTW, look fantastic from both the latest couple generations of Canon and Epson printers.) You can see the gamut comparison of a Digital C-Print from a variety of printer types (including Lambda) vs. an Epson pigment ink jet printer here. The white wireframe represents the Epson gamut, which is larger than the C-Print gamuts from Lambda, Chromira, and Lightjet.

In terms of tonality, yes, ink jets lay down matrices if tiny dots...however their density these days is extremely high. Human eyesight is limited to about 500dpi at a comfortable viewing distance of 10" for an 8x10" print. Canon printers lay down 4800x2400dpi, while Epson printers lay down as much as 5760x1440. Both are well beyond the resolving power of the human eye, even for a 4x6" print held six inches away. Tonality (which affects gradient smoothness) is EXCELLENT in modern ink jet printers. Even the basic rasterizers from Canon and Epson (as well as HP, although HP's inks are not as advanced) perform advanced dithering to produce high quality output that does not suffer from posterization banding or aliasing.

So, technologically speaking, pigment-based ink jet printers definitely have the edge over classic photographic printers. Whether they produce "better prints" is again a matter of personal preference...however the range of options for ink jet prints is extremely broad thanks to a very robust and extensive paper market. You can print on anything from high gloss papers to purely natural fiber papers, using fiber bases from cellulose, bamboo, cotton, and a number of other exotic sources. Modern ink jet luster papers range from glossy to semi-matte, and include a very broad range of baryta-type papers that offer prints that look nearly identical to classic photographic prints that people so loved from the film age. The range of baryta offerings has increased over the last five years or so, and the quality of these papers is extremely high, with papers offering high d-max with optical brighteners as well as purely natural fiber, acid-free base that offers a richer, warmer gamut at the slight cost of density.

When you factor in paper types, the diversity and capability of ink jet has a LOT to offer over classic photographic prints. The key benefit of digital C-Print, that classic aesthetic appeal, is waning as baryta paper offerings in the ink jet world strengthen. You may not be able to get a print 100% identical to one from a Lambda, but you can get extremely close, and who knows...you may like the baryta from an ink jet better! Technologically, modern ink jet pigments last for as long or longer in proper storage as a photographic print, and produce wider gamuts.