The head hitbox is much smaller when hipfired. You need the red dot to appear in the middle of your crosshairs for it to count as a precision shot when hipfired.
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Yep. I've gotten the dot to appear and it still registered a body shot. But even if that worked as intended, I'd still make the argument that if the circle is on the head or mostly on the head (red dot or no), it should be a head shot more often than not in PvE. I feel like that's not unfair or game breaking.
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I agree, I think hitboxes should stay the same no matter if you're aiming or not