I know what a game engine is.
I'm struggling to see how a game engine designed for a first/third person ground game would easily translate to a ship-based space game.
The game engine is the software that defines how textures are rendered and geometry calculated among other things. Basically it allows you to create objects and environments and plug them into the engine and it will then take care of things like behaviour of characters, vehicles, buildings, weapons and environmental objects in relation to each other. Things like the physics, collision detection, animation, AI and character interaction are all managed by the engine so the fundamental stuff like modelling, texturing, game scripting, basically all the good stuff that gives a game it's environment and storyline can be concentrated on.
A great example of this would be the Unreal Engine 3 which was applied to a massive number of games, notably for me:
Batman: Arkham Asylum
Gears of War 1,2 and 3
Mass Effect, Mass Effect 2 and soon to be Mass Effect 3
Medal of Honor
Mirrors Edge
...to name a few - More than 500 companies had already licensed the engine by 2007 and that was just the Unreal Engine 2.
Having a decent games engine massively cuts down the development time in a game and as a result the end cost of getting them out there.
It's pretty clever stuff. Conceivably if the engine for Outsider is in a pretty up to date state and was written in such a way that it's pretty accessible then Elite 4's character interaction, AI and environmental aspects could be significantly easier/less time consuming to create. That's of course assuming that the way that they have been applied to the game mechanic in The Outsider is at all polished. It could well be that the only thing that's in any form of completion is the graphics engine but even that we've not actually seen anything since about 2007 and as we know graphics and computer capabilities have moved on significantly since then but due to the consoles taking over a massive segment of the market the actual games themselves have not improved massively. One might argue that consoles are killing the progress of in game graphics but that's a whole other discussion.
EDIT: Sorry just reading that back I didn't really answer the question. A game engine is not generally specific to a game. A bullet striking a target may well be very similar in terms of collision detection as a missile striking a ship or for that matter someone blasting away with a gun in a space station. Interaction between a cop and the players character could well be very similar to the interaction between an alien and the players character on a planet. It's the way it is dealt with that is controlled by the game engine as opposed to the actual content of the action, if that makes sense.
