This works way better than it should. Latency is minimal and only affected by the network conditions. It’s certainly good enough to play most types of games.
Update: I did some latency measurement now. For my system it hovers around 50-70ms (video, photo). Tested with an 800×600 window at ~7% CPU utilization on a Core i5. My desktop monitor is a Dell U2711, which seems to add about 15ms latency itself.