Mimicking life on screen, particularly in terms of human body physics, has always been tough. While most video games (especially First Person Shooters) have typically relied on ragdoll physics, characters just don’t behave in a realistic fashion. i.e. they just crumple.
As a technical feature of GTA IV, what NaturalMotion’s “Euphoria” Dynamic Motion Synthesis (DMS) does is to essentially add biomechanics and self-preservation AI into the mix, thus you’d end up with different results when putting bodies through similar physical situations, e.g. characters try to balance when hit. The above video does a great job explaining this.
The Euphoria engine reminds me of Boston Dynamics’ Big Dog walking robot, especially when it gets kicked and how it tries to balance itself. Speaking of which, have you ever seen the beta version of the Big Dog? *chuckles*