So now I have a little more details.

I went back and played the sparrow gate dungeon in the training zone. I selected create a party, solo party, and did not let anyone else in. All good.

From the crash site, high quality was completely unplayable.
From the rescue camp, low quality was just fine.

But oddly, after dealing with the first few jello cubes, and playing around, I discovered something.

High quality graphics is playable. Wha???

Yep. With just that initial screen area, no monsters, high quality seems to work. Nice.

Except that as soon as I move into more monsters, I have about 4 or 5 seconds of no response. At all. I think I lost three health bars.

At this point, I want to say "Good Job". Really, Really good job. I could turn my shield on.

And, it's a good shield. It works. It's strong enough to be usable.

Far from being a death point, I was able to get enough control to move. Moving off to where I didn't have creatures, and could drop the quality back down to low.

Playing around, I think I've come to these conclusions:
1. As long as I keep my shield on, while going into a new area, I'm fine.
2. At low quality, the "response gap" is only about 1/2 to 1 second. I have no problem with that at all.
3. Once there's more than 4 creatures, laggyness is the rule. Bombs seem to be nice at this point because I don't have to be good at aim, nor do I have to have my client responsive enough to fire, release, fire, release on the keys -- the timing and detonation is handled on the server, monsters approach the bomb, and it works even if my client isn't responsive. Charge, drop, shield works
4. Anything more than "low" only works as long as nothing fancy happens.

So, what do I see?
A game design that works.
Shields that are effective enough to be usable.
The ability to inflict damage even with a client that can't aim properly.

But absolutely a need to spread the creatures I fight out.

Going through a level and a half of this dungeon, I see basically the same thing. Zones where I'm restricted in movement with a group of monsters are real problems. But not insurmountable. I'm flying across the screen. I can't keep track of where I am. I turn on my shield, and wait for things to stablize; then I switch back to bomb and slow retreat. When I'm down to the last one, guns work.

But any attempt to group would be a disaster. This is a solo-capable setup, but only a solo-capable setup. Trying to deal with another person, when I have to switch to "shield, and wait for things to stabilize" isn't workable. Having to have shields up and move slowly to survive monster spawns doesn't work with others.

And the windows machine from 2002? 2003? seems to work relatively well.

Oh yea -- even playing solo, low quality, some levels/sections are painful. The passage from rescue camp to haven with all the spikes and guns killed me from lag.

I haven't seen the release notes. Where are they?

I did turn it off on my last run (the 4 level at the entrance to Haven) and it was still laggy when there were monsters.

(Yea, I found it under Advanced.)