Kyatric's original reply explains this issue perfectly. Physics engines do not support "set position" or "set angle". If you do this instead of using the forces and impulses like the Physics Basics tutorial recommends, you force Construct 2 to teleport the object in the physics world, because the physics engine does not support what you just did. So each 'Set Y' to move it 2 pixels up is just teleporting the object in to the other object repeatedly, and the physics engine manages to play along for a bit then loses the plot because it's not designed to be used like that. We cannot fix this, it is a fundamental limitation in physics engines. Instead as the tutorial says you have to make the same movement by forces, torque and impulses, which works properly in the "physics world".
Closing as won't fix. I will separately investigate the animation frames issue reported by Kyatric.Ashley2012-01-30 21:44:01