"So can someone tell me, is TCAS useful in a Low level VFR situation?
More to the point, Is using TCAS considered an acceptable substitute (by anyone) for having traffic in sight? (I say No)"
1) A definite YES!
2) A definite NO!
I have modified my lookout scan to include the TCAS screen. It is an addition to, not a replacement for lookout.
There are dangers with a TCAS!
a) A pilot might put too much reliance on the TCAS but it doesn't take much experience in using it to realise that it doesn't pick up all traffic.
b) A TCAS target on the screen might mask another aircraft not appearing in that picture due to non-squawking. i.e. two conflicting aircraft exist and the wrong (non critical) one seen and concentrated on, to the detriment of lookout. If my co-pilot spots an aircraft from the TCAS, I try to lookout and not lose my lookout scan.