Hello all Commanders.
I can confirm that I managed to fix this issue for my particular case.
PC, Steam, Valve Index VR here.
The problem for me was because of the size of the 2D Window that is in my monitor while in VR mode, somehow I had the Screen Settings > Full Screen Mode set to "Window" and I resized it with my mouse and somehow the target system was completely broken and on the game menus the logo was stuck in a fixed position for each eye behind the menus.
What I did to fix it?
1- Launched the game in 2D, monitor
2- Settings to Full Screen.
3- Go to a mission or training, target something and make sure that the target lock is correct.
4- Pause game, go to Screen Settings, change full screen mode to "Window"
5- Ensure that it is still ok.
6- Pause game, go to VR Settings, toggle VR, and launch VR while in flight and in game.
That was it.
From now on I was able to Launch the game directly in VR mode and it is still fixed and fine for me, and this also fixed the stuck logo in the menus.
As a note I noticed that if I mess with the window size using my mouse on the corner of the window then the target system broke again, but I was able to fix it following the same steps.
Hope this helps someone.
May The Force be with you all.