I would have been way more inclined to believe they were working on a VR something if the Series X had a USB-C port on the front of it. a headset could easily pass all power/video/etc through a single USB-C cable, so one of those plugged in to the front of the console makes the most sense (and likely why sony has usb-c on the front of ps5)

I guess wireless is maybe technically possible, but that would introduce so many variables with latency, interference, distance, etc that it would be pretty ill-advised to go in with that on a first try. The video quality would almost certainly have to be compromised versus a cable as well, which isn't great for showing the 'most powerful' console we've ever seen.