I play a lot online and actually have not seen anyone deliberately cheating.
What you are describing is all about client-host lag and nothing to do with cheating. The game itself is buggy like hell and that's the main reason you see people flipping out on your screen.
What I would prefer is that people get kicked out of the session if the client-host connection is so bad that this happens. Because even though they are "teleporting" they still drive like **bleep** most of the time, and I can still get takedowns on them.
