Right, let's get back on-topic. Physics.
GT5 (and I'm assuming the physics aren't going to change between Prologue and the full version) feels a lot more like LFS from the driving point of view. What is commonly referred to as the "driving on glass effect" is way more apparent. Obviously that means GT5 is designed for use with a wheel. Turn all the aids off and you find yourself (or at least
I find
myself running wide and underbraking. The cars still behave like you'd expect though, with the characteristics of the car letting you know which wheels are doing the driving.
You can't roll the cars at all, and while Forza 2 feels like it wants to let the physics work and corrects at the last minute, GT5 doesn't even let you get close to the point of no return. I guess it corrects the z-axis as you go, so it never looks unnatural when you don't flip. But the tracks are designed in such a way that you rarely have the opportunity to get the car into that situation. There's only one track in GT5P with enough elevation changes and bumps that let you test the flip factor.
Again, to use Forza as the comparison, it has stealth driving aids even with everything off, I assume to compensate for the shortcomings of a joypad over a wheel. GT5 doesn't feel like it does. When everything's off, your controls need to be really precise with tiny movements to keep the car friendly. My LFS/joypad experience tells me that's pretty much the same here. It's not quite indentical, because obviously GT5 has native pad support, but it's pretty close.
I had to rewrite this entire thing because I'd written a FM2/GT5 comparison the first time and had to correct a load of stuff so let me know if there's anything that doesn't make sense