Recently practicing mrt at south city I noticed that sometimes glancing blows would throw you into the air but not often at all. What I noticed more was that the contact would ruin the suspension completely. Which is realistic for when the car hits the wall, no so much when, for example, you move a little to wide entering a corner and rub the wall. Maybe I am wrong as I don't know quite how strong SS suspension is but F1 cars can get away with tapping walls.
As for the collision detection and collision physics; Assuming no lag, car to car contact is reasonable IMO. The problems occur when there is lag or you hit a wall or the red and white barriers.
Thinking about it while i type this post, is it the collision detection needs work or is the damage model. If you were to hit a wall in reality hard enough to flip your car in lfs, your car would be ruined, or in the case of SS would only have 3 wheels. So you would not have a wheel at weird angles with impossibly broken suspension or a wheel to ride up the wall simply because it would of fallen off. Both damage and collision detection need work but is it a case that some of the problem listed as collision detection could be the damage.
On the note of favorite sims and fanboy's. All sims are fake, they all use canned effects as it is simply a computer program. The only way to get no canned effect is to go and drive your car sat in the garage. People go on their personal experience of their lives to judge what they are doing now and future events. Everyone's perception of what happens is different, in a real car and in a sim. Which means people will take what they perceive in a sim and compare it to their experience of real life driving. Just because one sim feels more real to one person - does that make it anymore realistic? Ofcourse not, realism is your own personal perception. The one factor that is true, not only for lfs but all sims and even some non sim racing games, is that we like racing and are here for good racing and fun. Hopefully that all made sense.