Is this specifically aimed at containing the mouse within the window? Or does it also make the view change with the mouse, without having to click (e.g., as in first-person games)?

I was testing and noticed it was counter-intuitive to have to click. Sorry if I misunderstood OP!

This is specifically about containing the mouse within the window. Having the view change with the mouse would be a separate "mouse look" feature.
The reason we require clicking to move your view is because our cursor needs to be independent so that you can interact with objects in the world. Also keep in mind that your head movements are networked to other users in the room, so it might be unnatural to watch someone else move their head when they are actually just interacting with objects. Still, might be worth considering if people are really confused by the need to click.

Thanks for the response :) It's not necessarily confusing, just a bit tedious if used to FP games 😅 I haven't heard any complaints from people I've interacted with about this, at least.

Bump -- People in the u::r::here meetup reminded me that they care about this issue. Should not be difficult for us to do this and give the users a pref once we have a preference screen.

I believe this should be addressed. The current implementation "is" a confusion for desktop users as mouse movement controls two separate functions, the screen and the cursor at once, and not only that, the cursor doesn't reset (for instance, in comparison to cursor movement within Godot Engine or Unity Engine.) so it's a stressful environment overall, although users may not be completely aware.