Heat from a fire is actually 3 things. The air that has been warmed by the fire, the infrared light coming off the fire, and the thermal mass of all the masonry that gets heated. The air does mostly go up the chimney, of course because otherwise your room would fill with smoke. The infrared and thermal mass are where you make your gains. There are also losses from sucking cold outside air into your home. This matters in a newer airtight home where you have to crack a window for your chimney to even work. On a drafty older home air was coming in anyway so not as big a tradeoff.