Err, of course PhysX means games will run slower than not utilizing it at all but what PhysX on GPU's purpose is to do this way faster than CPU would. UT3 gets over 200% performance increase with PhysX enabled on GPU on the PhysX enabled maps, a matter of playable and not playable scenario's on 95%+ of computers.
What I've seen so far is the efficiency of using PhysX on GPU is very good even on today's cards, now the next nvidia chip will most likely have even better PhysX-capabilities.
Would be of course better if you'd be able to efficiently do it with the CPU but I don't think physics on CPU will be a good move before we get Larrabee-like CPUs with really many cpu cores, but even then it will probably be more difficult to maintain a physics code for so many CPU cores, unless they'd come up with a groundbreaking multithreaded code in the API.
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