It allows 6 directions of freedom. You can turn, nod and tilt your head plus move in/out up/down and left/right. So you can lean foreward to get a clearer view of instruments etc.
It takes a little getting used to as you need to kerp looking at the screen with your eyes as you rotate your head around and the movement is scaled so you only need to move your head say 20 degrees to look behibd you in game.
The scaling/response curves can be tuned in software so you can get it to your own tastes.
As to immersion YES it improves it massively.