#2 only occurs if you have Google VR Services turned on (a warning pops up about turning it on if you do not have it on): Settings/Apps/Special Access/VR helper services - Google VR Services.
Presumably designed to ‘improve’ VR but if you look at it outside of cardboard it is a little strange.
Thank you for reporting this. Few questions for you:
Which version of Google VR Services is installed on the device, or what is the output of this command?
$ adb shell pm dump com.google.vr.vrcore | grep version
When you tap the Gear icon in the top right corner of VR mode, which viewer is configured under “Headset”? And, does this headset match the actual headset you’re using?
If you place the phone in the headset, are you able to see the image correctly? That is, are your eyes able to converge the stereo image? Or, do you “see double” when you look through the viewer?
With the latest Google VR Services the VR view should display correctly regardless of resolution. Just for testing purposes, want to confirm that you see the problem even when you set WQHD+ resolution?
Settings > Display > Screen resolution > WQHD+ > APPLY.