Its important to note that while this mod is installed you can't play online (Race Net, or Daily Events) Just restore the original to return to online play. Works fine in Campaign and Custom modes for single-player.
Spent quite a bit of time testing this out and balancing the damage to make it feel right. Major difference is stronger driveshaft and suspension springs. Engine damage is simulated much better (The co-pilot started warning me about the engine, a few minutes later it failed!) and component damage is better translated to detectable changes in the car (FFB is effected too!)
It turns out that I don't really need to modify the individual car damage files. While I can increase the amount of visual damage (and it looks cool) its way too complicated for the small addition. Now that the damage system is dealing out huge amounts of damage to the car, the visual damage you see is already beyond what you normally got in-game (without modding the files!).
Dirt Rally + Impact v3 + Hardcore Damage v2 = The Best driving game I have ever played!
I feel like I'm driving a real car, I truly fear crashing, and riding at the limit is heart pounding! This just finishes it off for me. We need to partition CM to add this type of damage mode into the game as an option!!