Overview.

Augumented Reality or Virtual Reality in the end are tools, so their usage depends on the problem at hand.
AR shines in places where our view can be enhanced with computated values, VR on the other hand is the pick when the real world has no (or negligible) role to play say in an VR RPG.

Virtual Reality

Virtual Reality is intended for use cases where the user wishes to be in isolation from the real world around him/her, this means the user even though physically is in the real world, the psych is in the virtual world (along with the visual and listening senses)
One such device that allows VR is Occulus Rift. Compared to the rest of the market, it's priced fairly decently (the basic model starts at 199USD with the higher models going up in specs but costing way more) and has a large developer community supporting its development (example: thorugh Unity).
Virtual Reality has a lot to offer in the RPG game area where such games usually intend to giving their players an "out of this world" experience, which is something the VR and the game genre has in common!
From the limited VR experience in the class, while it felt fun, as gliding through the skies of a forest in the comfort and confines of a room seems to be a luxury, it still felt rough around the edges including in user experience, even though this tech has been worked on for ages now!
VR is prone to physical restrictions, since our physical self is still in the real world, being confined to a small space while seeing a grassland infront of us, our instincts and things that we know arent aligned correctly, so even though we're aware of spacial limitations, our instincts take control and lead to injuries. Nausia and motion sickness act as the cherry to the cake.

Augumented Reality

Augumented Reality is intented for users that intend to be aware of their surroundings and enhance it with virtual presence instead of getting cut off from the old world entirely!
Augumented reality has a lot more scope in user applications than gaming (that doesnt mean there arent augumented reality games!). An example of that was a simple phone-AR with Quiver which needed no extra hardware and a compatible phone was more than enough!
A step further is Microsoft's Holo Lens which is a lot more powerful and with the support of Universal Windows Platform applications SDK and Unity support, has apps that can be built by anyone! The downside being the price, which goes in the thousands. On the bright side, a user can download and use an emulated holo lens for development purposes.
AR too has been in development for several years now and has found its place in people's everyday lives with AR Kit etc. There seems to be a lot of things it can do, from virtual calling to seeing birds indoors, what remains to be seen is development of tech that needs it as a prerequisite where it sees itself as a norm (like touch screens) than a fancy bell and whistle.
AR isn't as prone to physical limitations as VR is, since the senses are in sync and see the same things, but that changes from device to device (eg. Hololens vs a phone).