I'd say the lag is pretty much non-existent... There is always some amount of lag time with the new digital technology, and it's hard to say what is and isn't acceptable. I did a comparison of some 24" LCD monitors a while back because I was personally seeking a computer monitor that had good video capabilities and low lag.
http://www.bexox.com/showdown.htm
I am guessing that this projector is less than 30ms for lag time. That's about 2 frames per second behind. If I am being really critical, and trying to test my reaction time on a game controller vs. what I see on the screen, I can see that it is just every so slightly off. Now, I am not the worlds best gamer or anything, but I don't think in actual game play I notice it at all. 1/30th of a second is pretty darn fast. The AE2000 is most certainly on par with the 24" monitors I tested.
I really should hook my pc up to it and my CRT and run a timing test, just so I can know for sure what the lag really is. Heck, it might only be one frame per second off. *grin* Anyway, I read that the AX200 (720p panny), has a 5ms lag time in the gaming mode. That's just insane! No one could be fast enough to notice or care about lag like that. Well, my AE2000 is beautiful, even if it has a very small amount of lag in comparison. And of course, it does feel the same as playing a PC game on a modern 24" lcd monitor. The lag time on your local network (and especially the internet) will be bigger than this, so I'd say it's good enough.
Well, maybe in a week or two I'll move all the hardware around for a proper test. Anyway, I am rambling... Later!
Jim