On heavy Server lag (and only then) above 2 sec. the displayed Position of other Players and Boats go different about more than 10-20 Blocks. The mismatch is not corrected as long as the other Player stay in his Boat, leave his Boat, swim and walk around or reenter his Boat.
Only enter a brand new Boat or Logout/Login update the Position mismatch to its correct Coordinates.
Environment
Windows 32 and 64 Bit, Server env. unknown (may be something powerful like Intel I7 but single Core)
Quite a few issues on the tracker already like this. MC-95, MC-756, and MC-1291 are all probably relevant.