Hehe, looks good... until you want a specific behaviour.
Look how hard tuning pacejka is to make a car drive how you think it should. Now imagine the per-vert or per-object, or per-pixel (if it's texture based) values for deformation that you'd need to tweak to get the expected behaviour you wanted.
Problem with Racer is that it's free but also used for Cruden and their simulators (motion platforms), and that IS a commercial entity and I imagine that is how a lot of what we get for free is funded because it's also used for Cruden for commercial reasons. Ie, Ruud recently mentioned that their sims use SMD cameras for the simulators and that is why he had to code something a specific way.
I think we are fairly lucky really because that link helps give us Racer which is all said and done pretty damn good these days. We have AI, traffic, TOD, nice renderer and so on...
CryEngine 3 looks fancy but I bet the task of getting to where Racer is now with it would take years just to develop a decent physics/car handling part to it.
It's graphics do look nice but it's not anything we couldn't achieve in Racer for race track type stuff. We have a few bugs to iron out and new things to implement for that final extra quality but generally Racer is very nice looking imo!
Most of what we could need could be implemented fairly easily now with the new shader system.
As per the damage, I'm sure given a few GDC and Siggraph papers the 'magic' behind these demos will be rather elegantly simple and easy to duplicate.
I'm still not a huge fan of damage except where it's really required though. As authors we already have a pile of features we *can* use but don't yet, so adding more for what is ultimately a novelty isn't high on my list yet...
Getting a car to even hit a barrier and no do weird bouncing or weirdness is hard enough, never mind crumpling up realistically
Dave