Three source of lag: Network, CPU and GPU.
With moden graphics card these days that are generally needed to play many popular games today which exploits the FX features (shaders) and large areas (millions of triangles, textures, etc) while maintaining high framerates. From what I seen on my friend\'s PC, PS does not make use of these heavy graphical intensive calculation features such as shaders, thus the frame rate should be very high which results in no tearing of the image.
With a very stastic world (few character models, objects, etc), the only real dynamic data would mostly be positional data and collision detection, thus the CPU of the client should not be hard pressed to update the dynamic data. On my friends PC while running PS, MSN, etc the CPU is utilized less than 25%. Thus the CPU and GPU is not the lag inducing component here, yet the view is still jerky.
I am receiving a ping delay of 1s on average (even on DSL) to the PS server, which is very high for any online game (use to 10 ms to 20 ms for various servers). It is the network speed that is causing the jerkiness. Increase in the movement speed only increases the network traffic slightly (most of the time insignificant) as most of the traffic consists of changing positions to clients and commands to server. Increasing the speed a little won\'t really make a difference when the network lag is large (greater than 500ms).
Thus a little increase (like 20% will help) in speed should not make a major change to the jerky view.
I been reading about 3D graphics, renderers, modern GPUs, etc for interest and what influences performance.