The problem is that the gun pipper location is predictive, this means that any lag magnifies the pipper movement, to the point that it can be useless. There is some network prediction that helps "smooth" out the jitter, but there's only so much that can be done. Increasing the server tick rate would help, but I am fairly certain significant optimization would be required. It'd be so sweet to have a 60 hz tick rate, though, like on competitive FPS games.