The standard install uses no priv containers. https://www.kasmweb.com/downloads
I only mention the Linuxserver container because most Linux/Docker users do not want to pollute their base OS with stuff just to try it out.
That is how NX4, Chrome, RuskDesk, Zoom, etc. all do it.
You also have an inherent latency issue as you have to buffer 2-5 frames at 16ms a pop server side to encode the data.
Consider that oculus link uses video compression and doesn’t introduce the extra latency you’re describing. You only need to buffer frames if you want the best compression ratio. But you can always configure the encoder to not do look ahead. It’s also better to choose cbr over vbr to avoid the second pass of a frame at the cost of reducing quality/bitrate a bit. I’m practice it can work really well because even 20mbit/s is sufficient to send high res text.
I wish Remote Desktop applications would copy the oculus link architecture. You can easily get only a few frames of latency (sub 100ms) provided you composite on the GPU, use hardware encode/decode, and slice the video stream (which ie send 1/4 of the screen while encoding the next 1/4) which cuts down on decode latency and ensures you smear the expensive work across the entire refresh cycle time instead of having to do it all at once in a non-pipeline fashion (which introduces bubbles into scheduling).
And just about every phone, tablet, laptop, desktop made in the past decade has some form of H.264 fixed-function hardware decoding.
docker run --rm -it --privileged -p 3000:3000 -p 443:443 linuxserver/kasm bash
I had spent a long time trying to simplify Linux Desktop application delivery with linuxserver/webtop and all the derivative dedicated app images, but the speed and quality was always lacking as it was using XRDP in tandem with Guacamole. The difference with this new KasmVNC https://github.com/kasmtech/KasmVNC implementation is night and day. Depending on client hardware it will deliver 60fps 1080p and 40-60fps 1440p for both the JPEG and QOI rendering modes. A quick video can be seen here https://youtu.be/VkzG5BU2gjo .