I am under the impression that you CAN control it with your head

A head-tracker is just another input device (with 6 DOF, equiv to 2 thumbsticks, or a gyro+accelerometer, etc). It's up to each individual game how they make use of input devices, or which ones they support.
All of the games I've played so far that support head-trackers have used them to adjust your in-game head/neck's viewpoint naturally, around the default orientation of your body/vehicle as controlled by your mouse/thumb-stick.

donations are a limited pool. That limited pool should be directed to those projects that need it the most.

That's not really true. The project you linked to wants pledges from gamers that want an awesome sword fighting game (and it does look awesome), this project is aimed at developers who want to fund a first production-run dev-kit of a new HMD. That's two (mostly) different pools. I'm in both pools and have backed devices like this and the Ouya, as well as a lot of games... And I've never said to myself "I'd love to back that game, but I've already given out my kickstarter quota, I wish I didn't order a copy of that less deserving game!"
Also, the project you linked is also marketed with a bunch of expensive videos and backed by a very successful novelist, so it doesnt seem to coming from a very different place financially.

I am under the impression that you CAN control it with your head

A head-tracker is just another input device (with 6 DOF, equiv to 2 thumbsticks, or a gyro+accelerometer, etc). It's up to each individual game how they make use of input devices, or which ones they support.
All of the games I've played so far that support head-trackers have used them to adjust your in-game head/neck's viewpoint naturally, around the default orientation of your body/vehicle as controlled by your mouse/thumb-stick.