Avatar doesn't use the 3D ability as a gimic, with some scenes where hands extend out towards the audience. It's a full-emersion experience. You feel as if you are standing there, on the planet Pandora, watching.
And I caught myself swatting at bugs that seemed close to my face, or worried that burning embers would land on my clothes.
As for the motion sickness, there were times that I had to look away--when the action and the motion were too much to take. And I also have to admit that I was feeling a little sick as we left the theater.
I fully recommend this movie--it's a ride, a journey, that is worth the motion sickness--because it's a wonderful experience.