Re: I'm still trying to get my head around how Sony are doing this
There's considerable difference in the setup.
OR (and the Vive for that matter) is 2x1440p OLEDs, refreshing at 90hz and 90FPS per screen - hence the need for a beefy PC.
Morpheus is a single 1080p OLED refreshing at 120hz, with software FPS either set to 60 or 120FPS using asynchronous reprojection (TimeWarp in OR speak) to get 60FPS to an apparent 120. This is not the same as the frame interpolation you get on your TV which introduces latency. The single screen is split by software into showing 2x960x1080 screens.
Sony are getting around the SDE (screen door effect) by manufacturing OLED panels with a higher fill density in the centre of the screen, where your eyes will spend most of their time.
Image quality is AA, CA and the rest of the graphics package and is driven by software design, not hardware. The Heist has ligfhting and texture work at least as good as a PS3 running at 1080p native res. This is also before taking into account the massive leap that VR's immersion brings to the table and the fact that graphcis tech that works for a 2D screen (for example, shaders) either don't work or aren't required for VR where things like good lighting, decent AA solutions and above everything else a locked, rock solid framerate.
You're also overstating ORs case - they've licensed their rendering tech to Samsung for the GearVR series running on mobile - and a PS4 is comfortably more powerful than that.
Finally - there is no extra rendering hardware in the headset - again, adding this would incur a latency penalty, and the prime sources of non-vestibular disconnect nausea in VR are low framerate and poor tracking latency - neither of which the Morpheus or PS4 has an issue with.