From the way it was handling on that game, looks like its turned up too high
IMO, the wild tilting is not about going up and down hills on the track. It's about using gravity to simulate the forces on your body due to acceleration. The exaggerated tilting backwards and forwards, respectively, ensures gravity pulls you back in the seat when accelerating and throws you forward against the straps when braking. Likewise, the sideways tilting is so that gravity pulls you to the sides of the seat when cornering (cornering is also a form of accceleration).
Looks very cool. Might play havoc with TrackIR though!