Could you just allow variable delta between two bounds that you control like 1fps and 600fps and make sure that computations work at both capped extremes to avoid degenerate behavior? Or are there downsides to that approach as well?
Well, considering i've seen several games break even with 120fps (they were probably never tested at such high framerates), i'd say there are. Though the lower the cap, the less likely you are to see issues in such games (probably because the games were tested with those framerates).
But the tiny deltas are one issue. Another is that you get variable deltas and they can go from big to small (even capped) from one frame to another and this can still introduce numerical instability and harder to spot heisenbugs.
It might sound like a PITA to keep the previous state around but you really only need it for things that can't be calculated on the fly (e.g. position that can arbitrarily change) but others can be calculated (e.g. particles) and in the long term you are making a more robust system and saving yourself from having to chase after weird bugs. By having everything run at fixed updates you know that once you see something working, it'll keep working regardless of the framerate.
