Yes, but that's the original dev kit launched in 2012. Their current prototypes don't do that anymore, and they're still a year away from launch. Oculus is worried Sony didn't solve that. Sony just announced the device will use LCD instead of OLED. Oculus picked OLED for its low persistence which greatly reduces the nausea effect. We'll see. Sony's device is probably coming out next year, too.

And no, I think most VR PS4 games will be made at 720p@60fps. You might see some indie ones at 1080p. PS4's hardware is barely enough for VR, but should be sufficient for a decent experience. The worst part about it is that Sony won't be able to upgrade it until PS5, while Oculus will move on to 4k displays in a few years, 120Hz, better optics, and so on.