Sort of. Like Havok you have have a PhysX game that will do the physics on the CPU. Or you can have a GPU PhysX game that runs SOME things on the GPU. Batman:AA is one such game. They can't require an Nvidia card or they'd limit their audience to bad. You can turn PhysX off, or have it on a few different settings. By turning the PhysX on, you are simply adding detail. I haven't seen any reviews that show better frame rates, just more details.
If you look at the last graph you can see that enabling PhysX without a dedicated card your frame rates will actually go down. This review doesn't have the GTX275 with a dedicated card however. If you look at the first chart however you can see the GTX285 with a dedicated card doing around 35-40. (high PhysX setting.) This is 10-15FPS faster then the slower card. I guess your right that a dedicated card will help your frame rates go up. I'd still like to see a review that uses the same GPU. If the GTX275 can get that close, how close would the GTX285 have got?
If the game supports PhysX effects using the CPU, then yes OMG's right it does improve performance. If it has no CPU path and is just on or off, then the other scenario is what happens where you simply get more debris by adding the card.
However there are both types of PhysX 'enhanced' games, along with the standard, just CPU option which is what it is for the majority of games (even with the PhysX logo on them).
I think the OP should look into Lucid's Hyrda if he's dead set on trying to make his hopes of CroSLi work, as that's the only currently implementation, and it may improve over time over what the 200 series offers now.
No, 4745454b is right. The CPU doesn't do any PhysX calulations, only enabled Nvidia GPUs do. You would get extra detail that would be rendered on the PhysX card. However, there aren't that many games that truely support it to a degree that is well noticable. Most new TWIMTBP (the way its meant to be played) games do have some form of PhysX in them if you want to give it a try, but you won't miss out on anything major if you dont have a PhysX card.
Thats strange because in the link 4745454b posted it says
"Here, we directly compare the efficacy of a GTS 250 for dedicated PhysX when using a Radeon HD 5870 as a graphics adapter, compared to using only a Radeon HD 5870 and running PhysX on the CPU."