I believe it works as follows:
- There is some kind of torque (AlignOrientation?) that keeps the character upright. If the character tilts too far the switch to a falling state where that torque is disabled for a few seconds then re-enabled with some “i-frames” to allow the character to get back up without just falling again. It also points the character in the most recent lateral movement direction/
- There is a lateral force that quickly accelerates the character to walk speed when you press a movement key. When not pressing a key, there is no force. This force cannot be applied vertically, so the character can fall.
- When you jump, a brief impulse is applied upwards. It cannot be activated again until you are close to the ground. There are probably some i-frames after each jump to prevent very rapid “BLJ” style jumping.