That is a known issue. Updating the collission polygones means for the Physics engine a totaly new object every tick. Hence it runs out of memory. I saw in C3 that the error is knda solved, but that Physics dont work on a object with a scale sine attached.
You can use this exellent engine.
R0J0hound posted somewhere a workarround, i think it was something like dissable physics, then scale, then enable physcis. But i cant find it no more.
I found R0J0hound's workaround in this post (). Is this error fixed in Chipmunk Physics behavior?