I’ve had reasonable success making a physics-based arkanoid game. Using physical materials with restitution 1.0 and friction 0.0 hasn’t caused any problems. In typical arkanoid games the paddle behaves as if it’s curved, even though it’s actually not. Unless you really like the flat-paddle-that-bounces-curved thing, just make the paddle curved and let physics do its thing. That’s how most recent clones do it.
In my project I made the paddle physics-simulated as well, which is a bad idea if you want classic arkanoid behavior. Neither constraining the physics simulation to one axis in the settings, nor using a physics constraint to do it is perfect. The ball still loses a little bit of speed when hitting the paddle, though it depends on the mass of the paddle vs the mass of the ball. And of course if your paddle is simulated and the ball hits it from an angle, it will push the paddle sideways instead of bouncing off nicely.
You shouldn’t need or want the walls to be physics-simulated, unless they’re going to move around. Just make sure their physical material is set correctly.
You also don’t need or want a collision volume and a static mesh. The mesh should have it’s own collision set up in it’s asset file. Also if your ball’s collision is a cube it’s going to bounce very strangely, no? The only component your ball blueprint needs is the ball mesh, which may as well be the root, it makes everything simpler.
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Physics-simulated components don’t care about their parent’s movement, since they can’t inherit their parent’s movement and simulate physics at the same time. If you have two physics-simulated components in one blueprint, they won’t be attached together in any way, they will behave as independent physics objects.
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If you add a mesh or volume component as a child of a physics-simulated component and “Auto Weld” is on (it’s on by default), the two components will be welded together and simulated as a single body, with the parent’s physical properties.
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A component must have it’s collision set to Physics Only or Collision Enabled to actually simulate physics.