It basically works as per your first guess: Everything goes in the store. And no, it doesn't really have any performance or efficiency issues. Try it out and see. :)
Here is the CPU time graph during my tests: http://imgur.com/we9uGQ7
EDIT: OK apparently it's not accurate, see comment below.
In contrast the React+Redux app I'm working on uses the local Controller/Component state method and mashing on the keyboard there gave ~20% CPU.
I never would have imagined that Redux Form would lag on a desktop/laptop. I was more concerned that mobile performance would suffer. It's kind of impressive that a simple form can lag a desktop browser...
Untrue. It easily reduces the amount of code in your component, and actually gives you the ability to make your FormComponent as a stateless component.
https://gist.github.com/sorahn/6fac9f4717a81c96cd97e2bcc86a1...