It's almost impossible to have any sort of close racing in this game because the game hasn't synced up all of the players, everybody on the track see's a different view as to what's happening on the track. Cars are sometimes 3-4 car lengths in front or behind where they appear to be. Ie, you'll dive into a braking zone and leave about 2 car lengths of room, but the car in front will go careening off of the track and you'll get the pass. Even though you've left plenty of room, what you're seeing isn't where the other player actually is.
I race in a league where a lot of the members who record the race so we can compare footage from all perspectives and it's clear that there is a significant sync issue between all of us. We've all got pretty decent connections with good down speed and up speed so that's not the issue.
One really common problem is that cars appear to be further to the left than they really are, if you're spectating a car or behind a car, they'll constantly smash into the walls on the left side of the track, run over gravel on the left side of the track. On their screen they're about a car length over from what we're seeing. This makes overtaking and braking particually difficult because neither driver has any idea where the other driver really is. 2011 wasn't anywhere near this bad, sure if someone had a bad connection there would be issues but usually you'd know that there's only about 1-2 car length margin of error, which is to be expected with about 100-150ms of ping.
One of the members from our league put together a video showcasing perfectly what's wrong. It has both perspectives and then compares them side by side.
Why can't we just have netcode that takes the car's position, displays it where it should be and use interpolation to smooth out the polling rate, you could even use the ping times to extrapolate where the car's position accurately is after you take into account the latency times.
http://www.youtube.com/watch?v=7Z05YFJBo5M
