Interesting. It seems to me that client side prediction and lag compensation (aka the basics for games in similar situations) would have been a viable alternative.
While I can see that working well for echoing keystrokes in a terminal, I'm not sure how it would work when you actually enter commands into the terminal. Same for opening files in the IDE.
This is why most IDEs nowadays ask you something about "trusting files" when opening a project. They tend to lick and run on everything in there (at least for dynamic-ish languages, and maybe not "run" intentionally but do stuff which is arbitrary code execution more or less by definition) to analyze the code.
How so? Perhaps I don’t understand the context. Undoing text display is trivial, undoing code changes is already there, what’s missing? We’re not talking eons, less than a second.