Modern fighting games, as well as older ones that have been modded to included this (such as Melee), have a netcode model called "rollback" that can negate network-induced latency on local inputs. The trade-off is that what you see is usually inaccurate until you receive inputs from the remote player's machine.
Despite fighters often requiring fast reaction speeds, this downside is not a big deal granted that the ping is low. The first few frames of many actions are generally quite subtle, enough that they are quite hard to distinguish from each other; it's usually specific keyframes/poses that people will actually be reacting to.
Melee is probably hurt the most though, as movement is extremely fast and very important, and the difference between wavedashing left or right is not masked by subtle animations.
Sure, people play with ping disparity in tons of competitive games, but that's because there's not really an alternative for online play. It's "play with a ping disparity" or "don't play at all".
Once there is more widespread reliable alternative, which Riot seems to be working toward in their own game tournaments, maybe we'll see if this tolerance persists in competitive tournaments.
Low ping is part of players' muscle memory in how they react to visual signals. Changing that slightly creates a big difference, especially in the early and mid game where the outplays are less strategic and can often be more mechanical.
Even in later game teamfighting, the familiarity with latency between key/mouse input and actual in-game movement is mechanically intense (ex. auto-spacing in a close teamfight)
Of course 35 ping is not THAT bad and I agree, while unfair, it wouldnt be the end of the world, it's not even Worlds, just MSI, an invitational event.
imo it's very serious tournament
Another interesting scenario is projectile-based weapons. For reasonable Internet latencies and reasonable in-game distances, the projectile can travel faster than the packet announcing that it has been fired. The game state that gets sent from the shooter over the network is "I fired my weapon, I killed them". At the time you die, your client has none of that information, and since the shooter is favored, you just die out of nowhere. (This is less annoying, because I don't think you could move out of the way fast enough for it to matter. "My opponent's WiFi is bad, so I die half a second later for no reason" still feels pretty bad though. In the intervening milliseconds you had grand plans to win the game!)
All of this, to me, is a great lesson in eventual consistency in distributed systems. People break their keyboards over this stuff. Thinking it will be fine for your more-critical-than-a-casual-video-game system means this stuff will be happening to you multiple times a day, and you can't break your keyboard because you can only blame yourself for brining that system into the world. Tread carefully! Tread very carefully. Shit gets weird when your system has a split brain.
I dunno; I'd imagine people would be mad if there was a 15ms ping differential in Melee. I think the online/netplay tournament results are already looked at different than offline, console results.
Moreover, I'm pretty sure that you can't have a differential ping in a P2P game with rollback, so the competitive issues are different between the two scenes. I understand Riot wanting to equalize them. In Melee specifically, I think that the players have to decide on a common frame delay to play, right? If so, then the Melee community has come to the same solution for competitive netplay as Riot has.
They built a complex system to tweak tens of ms (at most) of ping to equalize. And they had a bug and it disadvantaged on team. Thus, they have to replay due to unfairness introduced by Riot itself.
They could've gone Option 1 - all teams at their natural ping. While it wouldn't be as perfect in theory, it wouldn't have resulted in replaying matches. Plenty of other esports and fighting games play at natural ping and have real results. There is unfairness due to location, but only scrubs blame 5-15ms ping advantage for a loss in a game as strategic as LoL.
People play Melee with ping differences bigger than that and it works fine lol. Waaay more technical game shows that there's tolerance.
Not to mention that the server option could've had some system to distribute across advantageous servers over the course of a series.