Its not false. You can read about it in almost every interview with developer who made popular racing game, even Criterion said that in DF interview ;] [check it]
And about deformation - You can do it on every car, but it really depends how deep and complex deformation is. Some manufactures allow more, some allow less. Some wont mind if tires or doors goes off, other does, but noone allow to deform car to the degree when cockpit or seats are getting damage.
BTW dont count that windows or light glass will break in GT 5, maybe in racing cars, but really doubt that.
About the lights ... there is not a chance as they are part of the whole mesh but with very detailed textures (as far as I know).
I may have not made my point clear from the very beginning.
What I wanted to say is ... on a very realistic driving simulator, why bother yourself making a damage feature that you can only half achieve for many reasons and that even your direct competitors failed to even make with half the quality of what you did (That is for you Turn1), where you could spend time polishing other aspect of the game like the AI for example, or making features that never have been made before.
Speaking about features that no one ever made, I recall myself drooling in front "Afrika" where you get a photo safari simulation with explanation of all the fauna and flora of where you are and what you shoot (Like National Geographic, but fun).
When you look at GT, it becomes more and more like a "drive any cool car you want buy staying home" game ... like a car encyclopaedia. I wonder if that would be cool to have something like a museum section in the game where you get the whole story of every car company with photos, testimonial (like every time you buy or win a new car, you also unlock part of the museum related to the car company), and an engineer section where some mechanics would be explained (like how does a combustion chamber works, how do you adjust a spoiler and why) a fun way to learn more about cars and that might give you tip on how to customize your ingame cars to make them more efficient.
PS : Car manufacturer are pussies, you can find all their car wrecked anywhere using Google image, could any of them manufacturer can guaranty us that if we crush there car onto a concrete wall at 120mph, the seats and the cockpit will still be intact and we can get out of it safe (why not make a general statement at the beginning of the game to explain that it a game and as so it cannot represent the truth of the car driving behaviour or shape ... whatever there lawyer would have make them say about that).
Image impact wise, do they really think that having one of there car modelled in a game, completely destroyed in a more or less realistic way, may tarnish there image more than manufacturing real car with huge brake defects that killed people and cost the company billions of dollars (yes I'm looking at you Toyota) ... When will all those marketing and PR douche bag get some common sense? BS
And honestly Criterion did a f*cking good job on that but my reference ... keeping the console generation context in mind ... was and still is Destruction Derby, but you can't call that game a car simulator.