I never played the German side in SH4 so I don't know if it works exactly the same as in SH3. But yeah, if it is not in Auto mode, then keeping the scope locked on the target has little use. The bearing wil not be kept updating. But that was SH3.
But the image quality of the video is pretty bad. I can't read the targeting data to see why the torpedo hit near the bow, instead of midship. You can see in the beginning that the DD and merchant were close to a collision. That's not a situation where you'd want to fire torpedos. As it is bound to mess up your solution.
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