Since they should be able to go all out with the hardware could we see more dynamic Vehicular damage? I saw increased numbers of cars and pedestrians in highways so maybe the effects could come back. Possibly they made Vehicular damage nonexistent due to hardware limitations? 

Probably not. I'm sure it's going to be a director port upscaled to 1080p with 60fps and nothing else.  Rarely is a dev going to go through the trouble of doing anything extra to an HD remaster, especially something like vehicle damage.

I think maybe there was an upgraded version from the start due to early trailers we saw which looked like the PC build. I think they really removed most of the effects due to PS3/360 being too weak.

this one is a hard one to tell.. They can do so much more with the new consoles, i hope we see a bit more than just the graphics boost. We'll probably get another voice over style trailer in sept-oct thatll detail the visual upgrades and any changes they make.

lol have you not seen the comparisons yet?

already confirmed

new wildlife, such as cats and hammerhead sharks
better foliage
more traffic
more details on vehicles, including interiors and cockpit view
There will be new jobs, weapons, vehicles, properties, and player customizations

I doubt it will be 60 fps, have they said it will be?

But will the story or characters be any better?

Both were garbage compared to GTAIV, imo

It's possible, I guess. I mean Rockstar's engine is certainly a scaling one, so we know it's capable of extra bells and whistles...but I don't think the differences between IV on PS3 and PC were in the vehicular damage dept. I could very very easily see the differences, but vehicular damage wasn't one.

It doesn't mean they couldn't have added it in the interim, but I doubt it.

Hopefully explosives will be able to damage vehicles like in IV. Currently in V, an explosion either blows up a vehicle or does no visual damage, unlike IV.