A "lagging behind" method, as mentioned is suited the best for most
projects, as the displayed paths of the entites are correct.
Just the time-offset is the negative point.

Using a DR System can handle the time-offset, so beeing in "sync" with the actual
serverworld, but will always create nasty jumps on the client, when the entity
is moving on a non-predictable path. (not in a straight line)

I see DR only important for very fast gametype, that require a high precision
(Shooter, racer).
All others can use a more precise "lag behind" method. (RTS, tactical games)