The mod potential is great... but the modders maybe not. I imagine it will take a more significant amount of work making the models and environments to all be interactive with the new physics engine. How many modders will be willing to do this?
On the other hand, those who are willing to do it, will probably be Very Very good.
Another game with a pretty detailed physics engine imo would be Halo. Cars get knocked over, can be launched into the air with grenades, etc. It's pretty cool..
Halo.bungie.org has a lot of the videos of such things.
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