Sony has significantly improved contrast and black levels compared to the older Sony. Other than that, this description below from the VW600ES (with minor edits) holds true for the VW665ES:
Most dynamic irises offer a choice of off or on. In some cases, for example Epson, there's a high speed and a normal speed iris option.
Sony's approach is different. First of all, they realize that the VPL-VW600 ES projector is very bright. Bright enough that in some home theaters, it might be too bright for some owners using a smaller screen, say 100" diagonal or less. For that reason, you can leave the iris in Dynamic mode, but set the maximum the iris opens. That limits how bright the projector can be, while still having the iris lower black levels on dark scenes.
Or you can turn off the dynamic iris (the blacks are still respectable), or just use it manually.
The iris action itself is interesting. The VW1000ES projector (the original 4K Sony, now replaced by the $27,000 VW1100ES, also exhibits this characteristic: The iris is sensitive to extremely small amounts of bright area on an image, in fact sensitive to amounts of bright that don't register with most other dynamic irises. The classic example is the pause icon (double bars) that appear in the lower left when you pause a disk played on a PS3 or PS4.
Most typical is that hitting pause on a dark scene like the Casino Royale night train scene has no effect on the iris with most projectors. With this Sony VPL-VW665 ES projector, that amount of "bright" does register and the iris opens a bit. Thus, in the dark scene images shown in the Black Levels section of the Picture Quality pages, blacks don't get as black when pauses, as they do when just viewing the film. The thing is, the black levels are excellent for this projector, so even with the iris opening a bit, the blacks still look great. Even the far less bright, and small Input graphic (ie. HDMI 2 in the upper left corner which isn't near as bright as the pause icon), is enough that you can see the iris adapt.
Overall, the iris action is noticeable on slowly lightening very dark scenes, as I found in Ender's Game, but also when viewing credits (white) on black.
With the VW665ES, I'm pretty happy with the iris action. Its spottable from time to time, but if you are into what you are watching, you're most likely not to notice, or notice enough for it to register. Works for me!