I've played about halfway through on the DK2, and it's incredible. The fear factor is on a whole new level – you're no longer looking at the alien on a monitor in front of you, you're looking at the alien in front of you. I'm not easily scared by movies or video games, but when the creature caught me in the medical area, I actually turned my back to it to get the "tail-stab" animation, so I wouldn't have to see it staring me in the face when I died.
My wife unintentionally scared the crap out of me late one night when I was playing with the headset on. I was trying to be super quiet around the androids in the Seegson Comms area, and she came into the office to check on me. She put her hand on my shoulder while I was hiding behind a table (in-game!), and I almost shat myself.
It's super-immersive, but you can tell it's not quite optimized, though. For one, the darks are very, very dark and can make it hard to see. Also, you have to kind of squint to read the text on the access terminals, and you have to use an xbox controller, because you can't craft with keyboard/mouse.
But I highly recommend trying it if you get a chance.