Real Flow is fantastic, I got a free version of it in a magazine a while ago, okay, it was limited you to how many particles you could use, however, the tech is for rendering and it can take a long time to calculate the physics in Real Flow, especially if the objects are more complicated. It might be better now we've got more powerful PCs and they've prolly improved the software (I am talking 2005, when I originally looked at it), there was a tutorial in the magazine that basically turned a female 3D model into an animated water woman. One step of the tutorial states, "Select the emitter, hit reset, then hit action and find something else to do for a while: the sim will take about ten and a half hours (depending on your system) and roughly 4.5gb HHD space."
You can see why I've never done anything more than make a tap dispense water in it.

. It's very cool, but very resource heavy and time consuming, completely unideal for something interactive like a video game or simulator, as Quik points out.
This would be damn cool seeing in a game and I am sure we will.