Latency and throughput are not inverses, although they may exhibit anti-correlation over small ranges. A low latency does not imply high throughput. In particular xterm does not buffer input / rendering, so while individual keystrokes produce a response quickly, when there is a high volume of text the throughput will be lower than other approaches.

This will still feel laggy, just a different kind of lag to the one that you perceive using a high latency terminal.

you definitely will not get 3ms latency by measuring usb input through to monitor photon output on a 60hz or 120hz monitor, not even in xterm

i think you did not understand the article