> Intel seem to have had to face the music and put the effort in and are way ahead right now. Even AMD's new quad cores are 13% slower than the Q6600.
and 14% cheaper.
"13%" slower is a little misleading, since that's an averaged value between all the benchmarks. If you look at the benchmarks, you'll find that AMD's new quad cores are around 25 - 50% slower than Intel's Q6600, while in a few other applications it performs a little better.
Regarding Ageia PhysX hardware, I think that physics just isn't specialized enough to justify dedicated hardware. Multi-core processors seem ideal for physics, AI, etc. in games because you're not locked to a single API, and the overall cost is much lower. For example, why would you buy a ~$200 physics card + CPU, when you can get Intel's Q6600 for ~$300 that will do everything the physics card does and more (AI, etc.)
However, I still think the Ageia PhysX API is useful. It's certainly one of the most powerful, feature-rich, and fast physics engines you can get for free, and doesn't need a PhysX card to work (it will even take advantage of multi-core CPUs). The only problems with Ageia's PhysX SDK is that the user needs to install ~30mb of Ageia Drivers before your game will work (you can reduce that to ~1 MB, but the license agreement doesn't permit it), and the code style of the PhysX API / tutorials / examples is a little "weird".
I think general-purpose GPU physics doesn't make much sense. Obviously it moves the physics load from the CPU to the GPU, but is that really a good thing? With today's quad-core CPU's, there's more than enough parallel processing power for physics. In this case, moving physics to the GPU will only slow down the frame rate of graphically-intense games because now the GPU has to share it's power with the physics engine, while your CPU most likely has an entire core idle.