I scraped a DK2 for cheap off of ebay, so I can address some of this.
Motion sickness does happen when game devs don't properly do their shit up - either the framerate drops below 90 or the latency is a little higher than it should be - everything looks exactly like it should, but you start to feel queasy because of minute lags that the brain is trying to compensate for.
So yeah, that's a thing in shitty games or on rigs that can't properly power a HMD.
When it works, it's amazing, though. Like actually amazing "holy shit i'm inside the game" caliber stuff like they say it is.
However
VR can't work for all genres - at least not in its current state.
It works in Alien Isolation perfectly (probably the best example of VR vidya to date), but that's more of a walking "boo" simulator and not a true FPS. You aim with the mouse and look with your head, so aiming your gun, even rapidly changing your aim, feels totally natural and easy, but there's not that much action going on. In something like UT deathmatch, shit might get way too fast for it to work smoothly.
It's also important to remember head tracking. When you see a video of someone playing something in VR, it looks really jerky and disorienting, but with the HMD on, it looks smooth as silk, because your brain believes what its seeing enough to "edit" the input like it would with the HMD off - basically the same reason you don't notice jarring jerkiness in your vision when you walk around in real life (this is also why head-bob even in non-VR games makes many people feel queasy - we don't really experience that shit because the brain smooths everything out for us in the wetware).
I hate how much this VR shit is pushing controllers. Controllers are the absolute fucking worst for VR. Use a mouse and keyboard. You need to be able to respond rapidly and fluidly, and controllers just aren't suited to that task. I haven't tried their "touch" controller dildo things, so I don't know if they're shit or not. MKB is solid, though, and should be all you ever use in VR.
This is another important point.
Devs should not make games specifically for VR!
I cannot stress this enough. Creating a game specifically for a peripheral only has one outcome: shovelware. It's what we saw with the wii, the kinect, the psmove, and with all "VR Games" made specifically for the HMD.
It's like making a game with the sole design goal being to show off all the qualities of a specific model of mouse - you're thinking about tech demoing first and game mechanics a distant second. Garbage through and through.
VR-adapting vidya has been shown to be extremely easy with a simple wrapper, so that's all they need to focus on. Take existing games and slap VR into them.
This works great in Alien Isolation like I said. Also works great in Euro Truck Simulator 2, Elite Dangerous and Subnautica. E:D is actually fucking fantastic with an HMD, even if the game itself is so boring it makes me want to cry.
Subnautica is like 70% great, but the devs seem to be having a hell of a time getting it right. Current problems are misalignment of player model in vehicles, slow movement speed in buildings, and the inability to move your view up or down without tilting your head up or down. You can turn around with the mkb normally, but up/down movement is restricted to HMD only. They also remove the mouse pointer so you have to aim at shit with your face to interact or swim up and down, etc. That's absolute insanity, and I hope they take that face-aiming bullshit right the fuck out of it because holy shit now.
Anyway. Early days. There's potential, but it looks like they're hell-bent on squandering it, so we'll see what happens. It's not a dead end, but Oculus/Valve might make it a dead end out of sheer incompetence. I wouldn't be surprised at all.