It will be good to play flat games for those not equipped with 120hz TVs. It will present a large 1080p "screen", but with Oled HDR quality.
Cinematic Mode: You can view the PS5 system and UI and all non-VR game and media content, such as streaming apps, on a virtual cinema screen. Content in Cinematic Mode will be displayed in 1920×1080 HDR video format with 24/60Hz and also 120Hz frame rate. The audio and image will be only displayed on the VR headset and there is no output on the TV side when you are wearing VR headset and playing in Cinematic mode.
Does PS VR2 support HDR?
Yes, the PS VR2 headset will display supported content in HDR, both VR Mode and Cinematic Mode.