I am going to feed 5V unresisted in through pin 3, ground out pin 2, and then read the output from pin 1. Would that be correct for this IR sensor?
Also is this analog or digital output signal?
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If you have a clean 5v power supply, then yes this would be safe. But check the Application Circuit in the datasheet. They have R1 resistor for current limiting & C1 de-coupling capacitor for protection against power-supply noise:
R1 and C1 are recommended for protection against EOS. Components should be in the range of 33 Ω < R1 < 1 kΩ,C1 > 0.1 µF
This is digital output signal. Check the internal circuit & timing diagram to be sure. The internal switching BJT is there to provide digital output.