1. A system comprising: a computerized server having a processor executing software (SW) from a non-transitory machine-readable medium, the SW enabling the server to manage a virtual environment (VE) comprising a plurality of virtually defined objects; a network interface at the computerized server communicating with a remote client-side computerized appliance allowing access to and interaction with the VE by a person directly operating the computerized appliance; a first physics simulation engine executing as a part of the SW at the computerized server managing the VE; a second physics simulation engine executing on the client-side computerized appliance, enabled to calculate object states and properties for objects in the VE; and an application executing on the client-side computerized appliance monitoring varying CPU capacity of the client-side computerized appliance and managing a variable volume client-simulation region (CSR) anchored on a specific object having mobility within the VE, the application dynamically expanding or shrinking a boundary defining the volume of the CSR according to a quantity and type of objects to be simulated within the CSR and the varying CPU capacity; wherein the second physics simulation engine calculates object states and properties for all the objects of the VE within the volume of the CSR, and the first physics simulation engine calculates states and properties for all the objects of the VE that are not within the boundary of the CSR as objects are assigned and reassigned to the first or second physics simulation engine as a result of said expanding and shrinking the CSR.