It mixes a virtual world with the real world; thus augmenting the real world. I would argue that a fine grain occlusion (individual pixels) vs coarse grain (movable display) isn't that big of a difference with immersion. Consider that we are immersed with our phones quite a bit already.

In addition the lack of 3D isn't that big of a deal given the brain fills in the details with other cues. E.g. People that go blind in one eye can adjust quite well to the lack of 3D.

I personally would love a HUD for my sporting activities; e.g. Skully. But my phone is perfectly fine as a daily driver.