Can y'all help me figure out GGPO some?

I’m making a fighting game engine on top of the Blender Game Engine. To start, I’ve broken up my to-do list into 3 components:
[list=1]
[]Animation logic
[
]Netcode
[*]Hotplugging
[/list]
Point #1 I’ve already got handled, seen here, and I’ve moved on to the networking code. Of course, I’ve decided to model online multiplayer after GGPO’s rollback method, and I’m coming along with recreating the gist of it. My problem, right now, is that I’m having trouble figuring how to implement part of the style.

I know you can set how much responsiveness you give up for smoothness, but the specifics of it elude me. Is it just simple input delay? How does it work when the other client has less/no smoothing set? There are limits to how far I can recreate the middleware within the BGE, but I certainly want to get as close as I can. Any feedback you can provide, technical prowess or just experience as a player, is greatly appreciated.

Thank you for your time: I’ll share my progress as it comes, if you’d like. This is meant to be a free and open-source framework, by the way. Everyone that wants to try making a game with it’ll be free to.