This answer is correct when doing pixel shaders, but if I use the Normal Direction node and plug it into the DX11 Displacement, it uses the local-space normal. I believe this to either be a bug, or an undocumented oddity of Shaderforge. If you need I can post pictures or a node-graph to prove it, but I'm quite certain this is true. I get correct world-space based coloring, but incorrect local-spaced based displacement.