First of all, are you shure that there is no PhysX effects ?
You won't be able to see debris without shooting a weapon, or smoke without jetpack (you'll aquire it after few levels)
Is PhysX system software installed properly ? Try to clear it with Driver Sweeper, and reinstall http://www.nvidia.com/object/physx_9.09.1112.html
. If you'll find something called "PhysX Game Software", delete it before reintallig PhysX drivers
Is you game copy legal ? (for example, pirate version of Batman: AA has like a half of PhysX content) Does PhysX patch applied correctly, without errors ?