Apparently the latest 257.15 Nvidia drivers no longer block PhysX functionality when coupled with an ATI video card. It's still up in the air as to whether it's intentional or an omission, but the driver will currently work unmodified for ATI users.
Perhaps this has something to do with the sudden departure of Manju Hegde, founder of Ageia Technologies - the company that created the PhysX co-processor that Nvidia bought and incorporated into it's drivers. Seems Mr. Hegde has decided to leave his VP position in CUDA and switch sides to become VP on AMD's Fusion which he believes to be the future.
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