Yeah it would be good. Not only because, lack of deformation means the contacts are bouncy, when nothing is absorbing that collision force. Lot of T1 incidents end up looking like a pinball machine multiball
But I think CPUs will be stressed a lot, with complex driving simulation and then on top the damage stuff. Maybe matter of dev resources too, for small devs (pretty much all sim devs)
Wreckfest has excellent (visual) damage model, I wish the handling was more simulator-like. It's kind of simcade already, but if the FFB and physics were on Automobilista level, it would be all I ever drive. Everything has just more weighty feel, when rough door to door driving actually bends some metal, instead of bouncing outwards. The mechanical penalties in Wreckfest are toned down, tough
I know BeamNG has even better damage model, but Wreckfest has more game/racing around the bones
iRacing, well good for them. Shows that it's possible for a sim too. Wish their handling was better, and damage model on wallet is an industry leader too...