Finally stumbled upon the HDR setting as well last night. I'm guessing its turned off by default because its not working right. My monitor is a SUHD 4k Samsung JS7000 with PS4 Pro and am having the same "rainbow" effect when enabled and no brightness control when the picture comes back. I was super excited that I found the tab at first but now just frustrated again... HDR works on Horizon Zero Dawn so its not a hardware/ software incompatibility.

I'm having the same EXACT issue, and they wont answer me here or on Twitter. I am having 2 glitches with HDR on my PS4 Pro (on a Samsung KS8000 4K HDR TV). 1) When I enable HDR I get this like flash of rainbow colors on my TV. When other games switch to HDR my screen goes black for a second as it switches. With Destiny 2 the feed doesnt cut out for a second like it should while the signal is switched from SDR to HDR, so I'm worried this rainblow flash could damage my TV each time it switches. 2) Once the rainbow flash is done, I have the same issue as you... I cannot adjust the brightness settings. Brightness level 7 is just as dark as brightness level 1. On SDR mode however I CAN adjust brightness from 1 through 7 and it gets darker/lighter as it should. Once I'm on HDR mode changing brightness does NOTHING. Other games in HDR look AWESOME on my TV with the same exact TV settings. Madden 18 and BF1 both look great for example. But HDR on Destiny 2 is way too dark and I am unable to change the in-game brightness to see shadow detail. Ugggh... I just went back to SDR