What distinguishes a physical system from a conceptual system?

Answer 1

In physics the word system has a technical meaning, namely, it is the portion of the physical universe chosen for analysis. Everything outside the system is known as the environment, which in analysis is ignored except for its effects on the system. The cut between system and environment is a free choice, generally made to simplify the analysis as much as possible. An isolated system is one which has negligible interaction with its environment. Often a system in this sense is chosen to correspond to the more usual meaning of system, such as a particular machine. But physical systems are often more esoteric: an atom, the water in a lake, or indeed the water in the left-hand half of a lake can all be considered as physical systems. In the study of quantum decoherence the "system" may refer to the macroscopic properties of an object (e.g. the position of a pendulum bob), while the relevant "environment" may be the internal degrees of freedom, described classically by the pendulum's thermal vibrations.

Answer 2

A conceptual system is a system of non-tangible (or non-physical) objects, such as ideas or concepts. It is an abstract idea. It may be represented in language or symbology, but those are representations of the conceptual system and not the system itself. Physical systems are tangible (insofar as atoms, rainbows and other "untouchable" objects are tangible). A physical system can be observed, touched, or otherwise sensed by sapient beings. Therefore a rainbow, although it cannot be touched, is a physical system consisting of light rays/photons passing through suspended water vapor causing diffraction of white light into its colored components which can then be perceived or observed.