I do have the idea that was a sweet explination! I do have a question though. The way I am understadning it, is that there are two different entities of the same model. One that is sent to all clients ( including the one your on) and the one that is shown on your screen ( the local one). The one that is sent to the client you said was invisible...so that you do not see it.

If that is all correct, why have a player on your screen? why not use the invisable one? or is the invisible one not realy there? I know I am missing a piece of knoledge here...what am I not seeing?

here is where my confusion. We create the entity localy ( on the client) we then update the server that this character exists. is the entity that is now on the server, that is being sent to all the clients nothing but the pointer itself?