I've done some testing with the prototype code on the Lurk level. Currently there is only one backup gamestate which saves every 900ms (10 updates) and i've simulated 450ms backtrack (morph given 5 updates in the past). It's somewhat working, but the morph update id is being clamped to the backup gamestate update id which produces inconsistent results when a morph is issued because sometimes it can fully backtrack and other times it's clamped which brings back the latency.
It seems that i'll need 2 backup gamestates which leapfrog each other so i can restore the one which is older than the morph command. Then the clamp will only affect morphs given over 900ms ago which probably won't happen much during a normal game.
To provide the best gameplay experience we may auto-disable backtracking on multiplayer levels which use moving land or event triggers, but this still needs to be tested. This is new territory