I think AMD is on the right track, Physics in games is gona end on the cpu in the end. At the moment the majority of games uses the cpu for physics, eg havok or some proprietary physics engine vs physx.
Plus the fact you cant buy a single core cpu anymore, and by this time next year we will have 8-12 cores. Now if you put physics in a game on the GPU what would the cpu do? Game logic? We gona get 8-12 core cpu's to do game logic? while we have GPU's that are still struggling to render crysis. I just dont see gpu's doing physics by themselves in games unless somehow physx was put into directx. But i cant see it happening.