> I want the blood to spill around on the ground and
> follow the land.
That involves physics and knowing what geometry is below the blood
> Would it be able to be done in a vertex shader?
Vertex shaders only know about one vertex at a time. They cannot
know about surrounding geometry (unless you put specific data into
the vertex shader constant registers). Vertex shaders cannot keep
state from frame to frame, so they are ill suited to an effect
> Do you think it would be good to use fluid
> dynamix?(Any links welcome)
Fluid dynamics? How does Navier-Stokes take to free-falling through
an atmosphere? I think this would be rather overkill, not to mention
hard to get to work well.
I would suggest a three-stage effect. First, you hit the emitter
and it starts emitting. Here, you could probably use a particle
system, although you may wish to emit elongated particles that
change shape, to emulate streams/spurts. You run basically gravity
and floor collissions on these particles, and render them using
standard particle rendering techniques.
Once this fluid hits the ground, it starts pooling. Here, your
particles start changing character into decals. You can either run
the pooling as decals with texture animation, or as a particle
system constrained and clipped to floor geometry.
Last, the specific particle/spurt comes to rest. At this point
it's a typical (static) decal and should be treated as such. For
extra effect, you may wish to tagged decaled geometry in general
so that a player walking on it will leave appropriately-colored
footsteps for a little while :-)