Wow, it's interesting to see people talk about this outside of the Oculus subreddit, where everyone there has been following the development of this device for the last three years.
Basically put, it's a VR headset that gives you a wide field of view (around 100 degrees), full 3D vision using two screens, one for each eye, 1280x1200 resolution per eye running at 90 frames per second with no motion blue at all and deep colour saturation thanks to being OLED displays. It also has a built in high end 3D audio card to give full positional 3D sound, there are also sensors on the headset and a camera on your computer desk that track the headset down to 1mm accuracy with no lag detectable.
the software puts you in a virtual room allowing you to select software ranging from full 360 degree 3D films, VR movie trailers where you feel like your actually in the movie and games that put you in the game.
People are going crazy right now saying that the asking price of $599 is crazy high, but it's actually crazy low for what it does.
Obviously you need a high end PC to run this thing, good VR doesn't come cheap.