As I answered in this question:
A quote from Aragorn, The Fellowship of the Ring, A Knife in the Dark:
For the black horses can see, and the Riders can use men and other
creatures as spies, as we found at Bree. They themselves do not see
the world of light as we do, but our shapes cast shadows in their
minds, which only the noon sun destroys, and in the dark they perceive
many signs and forms that are hidden from us: then they are most to be
feared. And at all times they smell the blood of living things,
desiring and hating it. Senses, too, there are other than sight or
smell. We can feel their presence - it troubled our hearts, as soon as
we came here and before we saw them; they feel ours more keenly. Also,
the Ring draws them.
From The History of Middle Earth, The Return of the Shadow, "Of Gollum and the Ring," describing what happens when one is fully possessed of the Ring:
Yes, if the Ring overcomes you, you yourself become permanently
invisible - and it is a horrible cold feeling. Everything becomes very
faint like grey ghost pictures against the black background in which
you live; but you can smell more clearly than you can hear or see. You
have no power however like a Ring of making other things invisible:
you are a ringwraith. You can wear clothes. (you are just a
ringwraith; and your clothes are visible, unless the Lord lends you a
ring) But you are under the command of the Lord of the Rings.
The talk of them being blinded by greed is indeed figurative, but it has a real application. Their greed for Sauron's power enslaved them to the ring, which led to their becoming wraiths. That is why they cannot see well. So they were literally and figuratively blinded by greed.