I'd like to try using my current GPU as a dedicated physx card as I upgrade to a newer card for Skyrum.
I think the dedicated physx capability is only available on gaming engines Nvidia has specifically made capable. http://www.nvidia.com/object/physx_faq.html
Since Skyrim uses the Bethesda in house "Creation Engine", will Skyrim make use of a the spare GPU's physx capability?
It won't do you any good on Skyrim. GPU accelerated physX is only available on a small number of titles that are specifically coded to use that feature, Skyrim is not one of these. The only two games to come out this year that can use GPU accelerated physX is Alice: Madness Returns and Batman: Arkham City.