I know that its possible to spoof a mac address out to a network. But is it possible to spoof the address, so that the Windows operating system and applications running on Windows see a spoofed address as the physical address for the network card?
Partially, yes. Windows OS (eg. using ipconfig command) sees the spoofed MAC address as the permanent MAC address.
However you can NOT say all of the applications running on Windows will see the spoofed one as the permanent one. Applications might be using some ways to acquire the permanent (burned-in) MAC address of the adapter. (For instance they might be using DeviceIoControl with OID_802_3_PERMANENT_ADDRESS option.) So some applications are harder to be fooled.