See the thread "Cautionary Tale". I had the same problem. My computer evidently didn't recognize me as the admin, so I could'nt properly install PhysX, or say yes to the licensing agreement. The fix is in the 2nd to last post. Hope it works for you!
Edit: Am pasting ilike2burnthing's fix here so it will be easier for you to find:
Once you have saved the [physX] installer to your computer, create a shortcut on your desktop by right-clicking the installer and selecting "Send To" then "Desktop (create shortcut)". Now right-click the shortcut and select Properties, then add ' /quiet' (minus quotation marks) to the end of the command line (aka Target Line) so that it looks something like this (specifically the end):
If there are quotation marks, for example:
leave the quotations where they are, then hit space and add /quiet.
It is important you make a single space between what is there and what you enter, /quiet
Now hit apply, and if you typed it correctly you shouldn't get an error.
Go to the 'Compatibility' tab and towards the bottom tick 'Run this program as an administrator'.
Now hit OK and double-click the shortcut. Everything should run fine from there. If you try to run the game and it still doesn't recognise it, restart the computer.