I see, so your definition of “physical” is “made of particles?” In that case, sorta yeah. Particles behave as waves when unobserved, so you could argue that they no longer qualify as particles, and therefore, by your definition, are not physical. But that kinda misses the point, right? Like, all that means is that the observation may have created the particle, not that the observation created reality, because reality is not all particles. Energy, for instance, is not all particles, but it can be. Quantum fields are not particles, but they can give rise to them. Both those things are clearly real, but they aren’t made of particles.
On the second point, that’s kinda trespassing out of science territory and into “if a tree falls in the forest” territory. We can’t prove that a truly unobserved macroscopic object wouldn’t display quantum properties if we just didn’t check if it was, but that’s kinda a useless thing to think about. It’s kinda similar to what our theories are though, in that the best theory we have is that the bigger the object is, the more likely the interaction we call “observation” just happens spontaneously without the need for interaction. Too big, and it’s so unlikely in any moment for it not to happen that the chances of the wave function not being collapsed in any given moment is so close to zero there’s no meaningful distinction between the actual odds and zero.