I think I understand your point, in that with the game play of light cycles there are only absolute moves that you've made. You still want to the player's action to play instantly on his and show up as fast as possible in the server's and other players' simulations.
Obviously lag in a moment of high importance is really going to feel unexpected in a light cycles match so it isn't a game suited to high amounts of lag.
You still want to see the other player move smoothly, and you can have that happen if you guess where he is rather than wait for acknowledgement. His prediction happens to be super easy while also being dangerously wrong if he's turned in front of you.
There is no solution to this type of gameplay being networked synced. Low latency is your only bet.
something that occurs me is that the server has to keep track of every point of every player to track collisions, basically a table of "playerID,x,y,timestamp", so when the client gets a status update, instead of receiving the current position of other players, he would get the moves of all players since the last update, limited to the x1,y1,x2,y2 of the client's viewport. Then the client would normalize the data (over time)?
Obviously lag in a moment of high importance is really going to feel unexpected in a light cycles match so it isn't a game suited to high amounts of lag.
You still want to see the other player move smoothly, and you can have that happen if you guess where he is rather than wait for acknowledgement. His prediction happens to be super easy while also being dangerously wrong if he's turned in front of you.
There is no solution to this type of gameplay being networked synced. Low latency is your only bet.