The mod has been revised! This new version eliminates physics/camera judder by allowing only one physics step per frame.
This is achieved by setting MaxIterations to 1 and leaving FrameRate (physics update rate) at the default 60 in physicsconfig.xml.
As we know, the game suffers from frame drops at least every few minutes while driving around and they can't really be prevented.
With the default game, these frame drops cause a long lasting judder. This is caused by the physics engine update rate and the rendering frame rate being out of sync. With MaxIterations now set to 1, the physics engine cannot adjust its speed by running additional physics steps during these frame drops like it normally does. This eliminates the physics/camera judder that has plagued the game from the start.
Of course this also means that during these frame drops the game will now theoretically run in slow motion momentarily. But in normal play this is not noticeable at all and the game now feels smooth because there is no physics/camera judder.
The downside to this configuration when comparing to the earlier version of this mod is that you have to always have a stable 60 FPS in game. Otherwise the game will run in slow motion.
But the upside is that you don't have to run the physics at higher update rates. This means that all vehicle classes will be playable without issues and you will not have any issues in cutscenes either. Everything works like in the default game (except now there is no judder).
The old version of the mod with the high physics update rate is still downloadable if you prefer that one. You can read the notes for the old version on the "Dependencies & Instructions" tab.

