It's less noticeable in WoW and D3 than in an FPS like Hawken or Splinter Cell, because you click on a point and your character moves there from a third person perspective.

I tried playing Splinter Cell Double Agent with 50ms lag to OnLive servers, and I couldn't do it because the aiming needed for the game was too precise to be playable with even small amounts of lag.

I would swing the crosshair over an enemy and stop when I usually did, but I would overshoot the enemy's head and have to swing back, then overshoot them again, then... die to bullets because I wasn't quick enough.