For the PhysX to be supported by both or either one or the other regarding ATI and NVidia it will have to live up to the higher level of graphics acceleration that has been promised. Note this early 2005 article.
"GDC 2005: PhysX Hardware Physics Accelerator Unveiled
Exponentially more stuff to blow to bits? Sign us up.
by Chris Roper
March 8, 2005 - AGEIA Technologies announced today at the Game Developer's Conference that it's doing to physics what hardware manufacturers did to 3D graphics back in the mid-90s: providing hardware acceleration for an exponential increase in the amount and complexity of physics objects in games.
Just as GPUs (graphic processing units) do with polygons, vertices and textures, the PhysX PPU (physics processing unit) will do for realtime phsyics. Instead of handling 50 or even 100 physics objects per scene like some games do now, games and applications that make use of the PhysX PPU will be able to handle many, many multiples of that. AGEIA is saying something around 30,000 to 40,000 physics objects per scene would be something that its PPU could handle.
If you like buzz-phrases, here are a few things that the PhysX processor is tauted to handle: universal collision detection, rigid body dynamics, soft body dynamics, fluid dynamics, smart particle systems, clothing simulation, soft-body deformation with tearing, and brittle fracturing for destruction of objects in gaming environments.
AGEIA's NovodeX physics API will be supported by its PhysX processor. Many developers, including Epic via its in-progress UnrealEngine3 gaming engine, are already implementing it so AGEIA expects that many PhysX-supported games will already be available by the time the processor is launched, which is scheduled to be released by Christmas 2005."
http://gear.ign.com/articles/594/594446p1.html