There's a big difference between slow as molasses and one frame of 16ms (which you sacrifice in exchange for no screen tearing). Unless you're really into high rank competitive shooters, I doubt you can even tell that 1 frame delay is happening.
Also, make sure you use the right config - there are actual issues with some competitors which are not Wayland architecture issues. For example https://github.com/swaywm/sway/issues/4763
There are ways to solve that and it’s not an architectural flaw. You just need prediction in the compositor to adjust the location of the mouse.
But honestly, the difference of a frame of latency is ridiculously difficult to feel and we’re talking about a half frame of latency here on average. It’s almost likely something else considering the entire end to end latency here is closer to 50-100ms on most systems and still isn’t what people would describe as laggy. Usually it’s some kind of software bug/hiccup that interrupts things to not be rendered at a constant tick rate or just getting hung and not processing events in a timely fashion.
The cursor is in the bottom half of the screen.
If I move the cursor, that should be represented in the frame that's being currently outputted, not the next frame.
Wayland has no support for that, by design.
The end result is that there is always a delay of at least one Frame.