That's exactly the example 
@Lanefan was using.  If the player declares "I jump over the moon", instead of saying, "You can't do that" you just narrate "You get a good 23 inches off the ground before gravity pulls you back down."  See?  Nobody said, "Your character wouldn't do that" or "That action is not allowed."
@iserith's approach to pvp is similar.
P.S. There is a difference between "actions they can't declare" and "actions that are meaningless."  The latter just means it doesn't change the game state in a meaningful way.  The former means there is somebody at the table who gets to tell you what actions you are allowed to declare.  Huge distinction.