He made a video while he tested his theory.
I saw that video! I agree with your description of it. But I do disagree with your assessment that fixing it is a tremendous amount of work. I believe it is a moderate to minor amount of work. I'm not going to explain why I think that though - but it has to do with my belief that you can't populate a simulated world with "objects" that behave in flexible ways without having some form of "property bag" system for each object including a hierarchical "inheritance" system for objects from their "classes" and "superclasses". And in a system such as this you would build it from the beginning with multiple hierarchical inheritance systems ... some static (is-a) and some dynamic (located-in, owned-by).
If they don't have such a system built in ... then yes it's a tremendous amount of work ... but its so obvious that such a thing is needed for this kind of simulated world why would you not have it?
Well, I guess I did explain why I think that. And it has to do not with my experience building games, but my building developer tools (IDEs and compilers) and multi-tenant SAS software. This concept (multiple inheritance hierarchies of properties) appears over and over in software systems.
And maybe this kind of fix (checking an inheritable property of the object (in this case, the avatar) against an inheritable property of the avatar's location) wouldn't solve projectile ballistics in vacuo but it would be sufficient to prevent the embarrassment of naked pilots floating in space, parp parp parp.
He can only do that by hacking his .cfg files
So I've seen this claim once or twice in comments on his videos, but I don't get it. Are you saying this game ships with user-changeable files that allow a user to, for example, turn off collision detection? Is that a common thing in shipping games? Or in "alpha" games? I get that software (including games) frequently have debugging modes, sometimes controlled by property files, that alter software behavior, but usually that stuff isn't shipped. Or if it is shipped (so that you can, for example, troubleshoot software installed on users' devices) it is typically under manufacturer control - residing in a database accessed indirectly by the client through the server it is connected to, or in an encrypted file that customer service sends to the affected customer.
I guess CIG could do otherwise given their claim the software is in "alpha" - i.e., plan to tighten things up later - but given that there is so much concern among gamers about cheating in networked multi-player games I would think a game studio would want to lock that stuff down in the beginning to avoid bad reviews. What's the story here?