I've personally flown with a friend's MRX PCAS. I wasn't very impressed. The fact that all you're given is a relative height and range means the target could be almost anywhere, so you're not inclined to take too much notice.
I've heard that the XRX that gives a relative position is a little better, but someone I know that used to fly with one says that it reports traffic that just doesn't exist, so again, after a while you tend to ignore it. He sold it.
Lastly I've flown in the US with a Ryan TCAD traffic sensor - a $20,000+ device which shows traffic on your MFD. It was fabulous and worked very well. However, as lots of people have said, plenty of traffic doesn't use a transponder for various reasons, so even this is far from foolproof in an environment where they're not mandatory.
On that topic I've never known an instructor that didn't recommend turning it on, to Mode C. I have known pilots who refuse to use Mode C in the case they bust CAS.
IO540 flies a lot of IFR, hence CFIT is decidedly possible. In VFR it's much less likely obviously.