They used a complex and buggy solution when a simple solution exists: Use the `tc` traffic control [0] program to configure the Linux kernel to add a fixed amount of latency to traffic from the local players [1]. If the game server does not run on Linux, they could put a Linux bridge/router in front of it.
[0] https://en.wikipedia.org/wiki/Tc_%28Linux%29
[1] https://serverfault.com/a/841865