Thanks for the reply. Now I understand the reason.
I am wondering if during the replacement of new Physics shape, if it could just save its final movement related parameters (such as VelocityX, velocityY, and the on-going accelerations) and then restore them into the new shape immediately. Would it then appear to continue moving? - Compared to letting it restart from zero velocity, which I believe would be impractical in any game.
By the way, I would like to share how I finally improvised around this problem while I was making a "Paper Throw" type of game, where you need the Physics object to be thrown ahead (in supposed 3D), which requires you to scale it down for perspective effects. Now, scaling would stop it from moving, as I struggled with for days. BUT I improvised by adding an invisible dummy physics sprite which I programmed to be thrown instead, while the actual "Object" is set position to dummy-physics object, and since that Object is non-Physics, I can change its scale any time independently while it follows the X/Y movement of the real Physics object.
I guess this quick trick will help others as well who wants to scale/resize a moving Physics object.
@Ashley, do you think that 'replacement' procedure, as I mentioned above, would resolve the problem?