Lag reduction is a big issue, and one that everyone is actively working on. I tried out two Oculus Rift DK2 demos at SIGGRAPH this year. The first didn't have

Lag reduction is a big issue, and one that everyone is actively working on. I tried out two Oculus Rift DK2 demos at SIGGRAPH this year. The first didn't have the new head tracking, and you had to strap yourself in to a walking pod to move around. That made me want to throw up after a few minutes, although I think that was mostly the exertions required to walk on the spot in slip shoes on not smooth enough plastic, turn, and push against the edge of the pod. The second I was sat down for, and it did have the new head tracking on. No motion sickness, and it was a really immersive experience. So possibly, anecdotally, that supports the idea that moving is a problem, although I'd still blame the walking pod being really uncomfortable to use more than the on-screen movement.