I had a go at this. It worked pretty good for me at the default res with server and client connected to the router with wires. I was able to play crysis on my lappy without much lag. With wireless it was unusable.
Ginga
There will be latency, as it would have to encode whatever game is on the screen to the video stream, that would add a second or two depending on the speed of the server cpu and the resolution. I doubt you could play online fps with much success, would be like playing with a 500ms ping or something.