The physics were good in TMB, but they were different. From what we had a chance to play in the PSP game, we have a feeling that this edition may be a little more loose and touchy, like some like.
Handling of this game (which has always made use of as many buttons as it can get) has simplifed well to PSP (Triangle selects the special weapon, and double-tapping the gas goes into nitro as it did in the more recent TMs -- other than that, the buton layout is just like others in the series), so it's just a matter of preference whether the game feels like the Twisted Metal that you like best.
Weapons in the PSP version included the exploding cans instead of the napalm fire bomb, and the zoomers seen in the PS2 game are also in this version -- we're not sure how some of the tweaks will affect the hardcore, but it's all in the balancing as far as most TM players are concerned.