I got inspired from Tippett studio's Harry Potter's effect. vimeo.com/29154020
TP5's Bullet Physics is pretty stable in this situation. I use Convex Hull for GeomInstance objects. Sub sample is Per Half Frame. Calculation itself is so fast.
dl.dropboxusercontent.com/u/5968011/TPSample/TP_BulletPhysics02.zip Scene file is here! You can DL it. I hope you can enjoy!