When we demonstrated Game 2, dynamic buildings destruction was one of the features we were talking about, and one which was liked a lot by those who have seen it.
What we had:
Playable prototype of several buildings which were dynamically desctructible. The destruction was very impressive, using physical simulation, and leaving plenty of permanent and dynamic debris.
What we did not have:
AI reacting to changed environment
Solution for multiplayer
Technology optimized enough so that it could be used extensively in the larg environments
A building creation pipeline which would allow use to create such destructible buildings efficiently
Back then, we hoped we will be able to solve those problems in some or other way. Unfortunately the reality was different. In spite of the fact we invested a lot of time and workload into those problems, especially the last one has proven to be too difficult, and it was clear the idea in its original form needed reworking.
We did some redesign, learning from the problems we had, and after that the building destruction system for ArmA 2 should look like this:
Based on ArmA destruction
Buildings having multiple parts collapsible independently
Physical simulation used for falling debris / wall parts
No permanent debris left
We think a solution like this will bring most of the benefits of the dynamic building destruction to the game, but will be a lot easier to implement (and prepare data for), will require a lot less CPU power for simulation and will be friendly to both AI and multiplayer.
I understand some people will be disappointed, as this is not what we were originally talking about, and it is not what we strived to implement, but I hope most will understand the decision was not easy for us and we decided this way because we have seen it as the best for the game we are developing for you.
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