and please bare in mind that lag is almost always a factor in any online game.
and also there are ways to reduce the lag in a game. make sure you check your connection rate with the other player when finding a match. xbox live always has a list of games you're searching for. and in that list, next to the names of the different players, you'll see a small graph, meter, bullet, or whatever, that'll tell you how much lag (if any) you should expect from playing in a game hosted by that particular player.
other games such as Halo 3 has options to simply search for games, search for games hosted by people speaking your language, or (which is more important for me) search for games with the best connection rate. it dosent show a graph, it'll simply find the better connections automatically. then you'll see the connection rate between the individual players when their names are listed before you start play.
all in all, you should always expect some latency when dealing with online play, but the quality of that connection is determined by YOU.
YOU WANT THE TRUTH?
http://forum.teamxbox.com/showthread.php?t=441335