Just made me laugh thinking of showing where the actual rifle would be to look straight down the sights without the head tilt. It would be half in your head, so maybe a 3PP is not such a good idea, or they removed all real aiming and only used hip shots (Joke)
I assume the "joke" is only using hipfire, not the actual 3PP usage.
First, let me state that creating a first-person game without a proper 3D model IS possible, and plenty of games do just that. For example, Firewatch can serve as good and funny example:
Firewatch, like many video games, is played entirely from a first-person perspective. And it turns out there is a very good reason that the game never
www.gamesradar.com
Now, if memory serves Firewatch doesn't actually render the main character's shadows (albeit please correct me if I'm wrong, I might remember wrong), which is why this aspect isn't an issue.
But that's an indie title. We'd expect something more from a big budget game like Cyberpunk. Developers should have created two working models - a regular 3rd person model with normal animations, just as if they were making a 3rd person game. That's the baseline for shadows and reflections. Next they create a second model, rendering only hands and torso with legs. This one can reuse animations from the proper 3rd person model, but animations don't need to be realistic and this model can definitely bend unnaturally as this model would be used only in first person. It's not that a head-tilt wouldn't be possible - it totally would! But it would feel weird and unnatural in a video game, and could cause a lot of motion sickness. And even for handguns (which you can just hold straight in front of you) this wouldn't look "right" in a video game - if you were to do that then the gun would look too small and be too far away from what is normally expected.
Next the two models' properties are set - 3rd person model casts shadows and reflections, 1-st person model does not. Additionally using "masks" (a mechanism that dictates when which 3D object is visible to the camera) they set up the visibility of both models - when in first-person you can't see the 3rd person model (reflections and shadows still work), while in 3rd person (car driving, cutscenes) the 1st person model is invisible. There's also an extra layer of fiddling where, say, the 3rd person model shouldn't cast shadows onto the 1st person model, but those are all properties that the engine should be able to set. Yes, this approach is still not 100% ideal and accurate, since you'd be able to see inaccuracies in reflections; when aiming down the sights of a rifle a reflection would show a head tilt that would be required, but the first-person camera would stay perfectly still. But this sort of inaccuracy would be completely ignorable by pretty much every player, and besides a realistic head-tilt it wouldn't be "solvable".
Now, granted, this does mean a bit of a performance impact - but it's NOT severe. Essentially you need to render an additional pair of hands and a torso (without the head). Granted, the game is already struggling hard on old-gen consoles, but this really isn't that big of an impact. And viola - you have a fully functional first person view AND the option to switch to 3rd person AND proper shadows AND reflections.
But... yeah, CDPR took shortcuts.