FWIW I just had a really good session with the DK2, tweaking settings. My system is reasonable, but not outrageous - an i5 and an AMD R9 270 (fairly moderate GPU by current standards)
I found running it as a secondary display allowed me to choose 75Hz as the refresh, whereas direct didnt.
Turning OFF vsync helps smear out any juddering. I set everything else to high
I found that turning ON FXAA anti-aliasing massively improved the visuals of distant objects, especially stations. I didn't notice a performance hit on my card with this on.
I turned shadows to medium but this seems to be buggy wit the Rift, as the light source seems to follow your head ! Turned back to high !
I also set up my IPD - I don't know if it was this, or resetting the Rift centering, but I found text much more readable and found I was sat 'closer' in the cockpit then before.
The 3D separation control seems to do nothing for me. I do find that everything feels a tad too small. For instance, the pilot body looks about ¾ scale. I was hoping to be able to change this sensation of size, but can't see how. I can only imagine how huge the stations would look then !
Best of all, I turn ON bloom and cranked the gamma right up to the right. Sacrilege I know, but it really improves the visuals for me - I hardly see any black smearing. I set it at about the level where smearing around the canopy frame just vanished, which was about 9/10 of the way up the slider. This combination of settings really makes the light on stations look realistic - it's bright and the reflections really blow out. Looks great IMO
I kept the Occulus quality slider almost at the top - again, about 9/10 of the way.
These settings let me play a very smooth game on the rift with readable text and fantastic visuals, on a relatively modest GPU. Incidentally, I noticed that the GPU is not getting above about 75% usage, but these are the maximum settings I can get without seeing juddering. I feel there's definoe some optimisation gains to be had in the DK2 drivers or something.
Hope these settings are useful for someone