We do, in fact, now constantly inhabit a sort of blended VR, but we now assume that we don’t need the goggles as long as whatever’s on the screen is sufficiently engrossing. And the distinction between real and virtual continues to blur. The virtual is colonizing the real, but generally in ways we don’t notice. VR was predicated on a notion of real/virtual that now seems very last-century. Our grandchildren won’t be able to readily imagine where we were at, with that one!
Whatever Happened to Virtual Reality? – Virtual reality pioneer Jaron Lanier interviewed by R.U. back in 2002.
Notes from a William Gibson Q&A Session (9/08/10), which covers a little of the same ground.