It depends. For cars and such, it would look very ugly, however for a cow it would look nice.
For the other way around, cars would look like they actually fit, for a cow it would just look really weird seeing it go all car-like
It's just meh. Very debatable. Personally I prefer physics for wheeled vehicles and flying vehicles and bots for living creatures or small things.
I do agree that we badly need an update to the vehicles system. Make boat-like physics vehicles easier to make and work better, stop the odd physics craziness. If you're gonna make cars be bots JUST BECAUSE of the physics problems then I think that is just silly. When it does work, it works nicely. What I want to know is why speedkarts freak out more, when we used to have freaking jeep sumos back in v8? I think it's something with the speedkarts themselves, maybe a setting is just too high or a special code breaks the game in some way.