When you lower the image zoom setting, you get black bars above and below the image. That’s how the zoom works. Alternatively you can instead set an ambience colored background after clicking on ‘More FullVR settings’ in the menu if you prefer that.
The black area below the image is a bit larger than above since VR headsets use an asymmetric view frustum where more pixels are shown below the eye than above to have more precious pixels where it counts. A neat optimization that factors in human vision, which focuses more on things below your eyes than above in the sky. Since the the game was rendered with its usual symmectric frustum, you end up with more space below than above the image when you zoom out.