FUD Zilla has some more info on ATI's plans to do Havok physics on the GPU:
Sources close to ATI have told Fudzilla that AMD plans to support Havok in ATI hardware whenever it makes performance sense. Moreover they told us that they want to do physics on a GPU only if this will add to an overall performance of the game.
You can remember GRAW and first Ageia benchmarks when you would get better PhysX but lower FPS if you would use Ageia PhysX card. This might easily happen with Nvidia’s GPU implementation and ATI simply wants to avoid this.
It looks that ATi will bring Havok support on GPU when the overall gaming experience gets better by doing that but still some voices closer to Nvidia are keep repeating the rumour that Intel is keeping a Havok GPU acceleration for its Larrabee. We still don’t know if this is true or not.