It only needs to compare actual file contents if the file properties (dates, size, ownership, rights) have altered with the options used in this example so it would only need to perform directory reads in the case of no such changes. Of course for a very large project this could still be significant, but much less so.
Comments
running rsync every 2 seconds on a medium/large project might be a little intense since it compares each file looking for changes.
It only needs to compare actual file contents if the file properties (dates, size, ownership, rights) have altered with the options used in this example so it would only need to perform directory reads in the case of no such changes. Of course for a very large project this could still be significant, but much less so.