I don't think it needs to be perfect for there to be massive demand, but it does need to get a lot better than it currently is.

Games where you are stationary (racing simulation, mainly) are better suited to it. Gran Turismo 7 in PSVR2 with a Logitech racing wheel was a ridiculously immersive experience. I played through the whole game in VR and it was one of the best gaming experiences I've had and certainly the most immersive, particularly as a diehard car guy. But racing sims are fairly niche.

Outside of racing sims, it's still immersive, but any games with character movement give me immediate motion sickness, the movement is too clunky and disorienting.

If they can figure that out at a reasonable price point the demand will be there because the immersion is just night and day against a screen.