I know about a little physics -- enough to be dangerous. Enough to wonder what people mean when they say their sofware is "physics based."
I hear "physics-based" a lot at the GPU Technology Conference. For example, virtual dummies, roughly the shape of humans, are being flung through virtual wall, much to enjoyment of the assembled. The "simulation" is termed physics based. It is said in a way that insists that, yes, that is exactly how a body would crash, how fast it has to be flung before the wall starts to break up, how the pieces of the wall fly through the air, etc.
Oh, yeah? I have not studied realism in crash test dummies personally. I have witnessed the effect of a large calibre bullet bust up a thick steel plate. The shock wave from the impact of the bullet made a chunk of the plate break off on the opposite side and fly around the room -- an effect known as spalling. I pondered the equations that would model the shockwave. They were intense. The modeling of a dummy through a wall -- hmm... let me see. You could assume the dummy is an articulated collection of rigid body masses but what about the point of contact? The local deformations would be key in determining local failure of the wall at point of impact so rigid bodies need not apply. The wall itself was not simple, composed of vertical structural members and several layers. This was a far more complex problem than my bullet/plate problem.
Now do you think NVIDIA was solving all those equations. I think not. It's for fun and games. The results will not protect crews in armored vehicles, or protect office occupants from catapulted bodies. (Didn't they use to dead plague victims into besieged cities?). We see more "physics" applied to splashing water. I think modeling fire and explosions is absorbing our brightest minds -- for the movie industry.
It would be nice if the industry adopted a level of physics based. At the lowest level, say level 1, would be if F=ma could be found any where in the code, even if it used for only one object. At the highest -- and possibly unattainable theoretical limit -- the magical physics based level 10, where every molecule in the picture behaves according to known laws, with each contributing to the motion and interaction of the bodies of which they are part.