Well, they'll definitely use the cuda cores in directcompute 5.0 and havoc - gpu.
I agree it's irritating, it's like me having a dx11 gpu, pushing around 5x the computing power than your gtx280 and still not having any gpu-physics built into my games too

But at least i get sneek peeks at dx11 awesomesauce like in dirt 2 and unigine

In the end, games will get there, and until then we'll get small peeks into the future, but we'll just have to wait i guess. At least nvidia do push this kind of stuff onto developers so we do get to see it occasionally.
But no developer does it out of choice because of the aforementioned AMD dominance in the high end market (and dx10/11 gpu's can all do gpu-physics on direct compute, but developers just don't care). It's pretty much a proven fact that games with physX actually lose out in sales because they lock features that, by right, can be replicated on AMD cards if they used an open standard, so AMD users ignore the game

I agree that gpu physics is much more effective, but the cpu issue is also important. CPU's are cheaper and are also much less utilised in demanding games, so most of the time it is best to keep it on the CPU, but i know that gpu physics is the future for really complex and amazing things, i just have to look at AMD stream demos for that kind of stuff.
Anyways, i guess my rambling is that physX is kind of the appetizer, not the main course

hopefully that main course will arrive soon though, i'm starving!
P.S. 3 posts = no edit button
