I have used high and low-res VR and stereoscopic devices. It's not really that bad using a low-res one, latency is a much bigger factor. High latency causes motion sickness and overall crappy response/experience. That said, 1280x800 is actually pretty decent, and allows for high frame rates (try rendering even 1080p in stereoscopic mode at 60 fps -- not an easy feat.
That's actually the size of the panel. The resolution for each eye is half that, so 640x800 per eye. From the pictures I've seen to try and emulate it by printing a game render on paper and holding it a few cm away it looks pretty good :)
