You and Crytek are the ones trying to explain the lack of functionality away without detailing why those limitations are necessary.
If I were to explain the plausible scenarios in even greater detail, it would make no difference as far as your concerned, apparently. I decided to think of it as a developer and why they would do this, not just as some MS marketing scheme. Then certain things started to jive for me. You still don't want to grasp the relationship of DX10, a graphics API, with physics, CPU bound functions, and why Crytek indicates DX10 API makes a difference for physics. even after it was explained.
Could they have incorporated some of the missing physics in DX9? Yes, not with as many particles as DX10 could do or utilizing geometry shaders, or Shader 4.0 which is utilized.
DX10 isn't necessary at all really, neither is DX9 for that matter.
Maybe if the DX10 enhancements didn't exist then you wouldn't know what was missing in DX9 and you would be better off.
Crytek probably goofed by making this public now, in the limited fashion they did.