Interesting theory cvearl and when I started to think about it I could see what you were getting at. Now I drive in cockpit view (67 FOV), but tried experimenting with the view attached, which I think is what your suggesting, someone else posted something similar previously.
The only "problem" with this view is that you do need instruments displayed but to overlay these on top of your view is still unrealistic, IMO, hence the reason most people go for cockpit view with instruments visible.
Still, interesting theory. In the attached view, what you need is the ability to move the drivers head down and left to see the speedo to simulate the glance at the instruments. Something for the future perhaps?
edit: Just thinking a bit more about the moving head comment - I guess that's what TrackIR is for! Still, assigning a keystroke to move the head would be useful.